Egangakinosbonik saving and credit cooperative society (SACCO) in Katakwi district is struggling to recover millions of shillings from its members.
Investigations by the office of the district commercial officer and microfinance support Center reveals that by October 17th, 2018, the Sacco’s outstanding loan was shillings 28m.
The loan represents 45 percent of the principal capital of 8 m paid by the members as shares over the last seven years. This came to limelight during a recent interview The Cooperator had with the district commercial officer Patrick Todi.
Todi told this website that during an engagement between the Sacco members and officials from the microfinance support center, it was discovered that the manner in which the management is running the Sacco is not transparent.
Among other issues discovered is some members were taking money through unlawful means with the help of the board committee without involving the loans committee and the manager’, said Todi.
Geoffrey Omolo, the Sacco manager told The Cooperator that efforts by the management to recover the money have proved futile as some members are on run while others have deliberately refused to pay the loan despite several reminders.
He added that some people had put money in the name of shares expecting to withdraw later and yet they didn’t understand the difference between shares and savings.
‘By the time I tried to recover the loan, many people would tell you that recover my loan from the shares and yet by law shares are not supposed to be withdrawn or used for paying the loan’ stated Omolo.
According to Omolo, failure by defaulters to pay back the loan has put the Sacco on the verge of collapsing as many members have withdrawn from the Sacco while others have stopped paying either savings or shares.