Unaitas Sacco has reported 26 percent jump in profitability to 426 million from 338 million for the financial period ended December 2018, buoyed by an increase in loans advanced, prudent non- performing loan recovery efforts and a reduction in overall costs due to digitisation and automation of services.
Total income grew to Sh1.8 billion representing a 14 percent growth from the previous year when it stood at Sh1.62 billion. Interest income contributed 83 percent of the total income after robust loan recovery efforts put in place last year began bearing fruit.
“Our loan book grew by 22 percent backed by a strong personalised marketing, relationship banking and upturn of the economy,” said Joseph Kabugu, chairman of the Unaitas SACCO adding that Agri-business value chain and SME were the main sectors in lending with personal lending and chamas also having a fair share of the loan book as well.
“In 2019 we expect higher profitability backed by non-funded income and reduction of cost through automation and digitization,” Kabugu told the Sacco delegates during the 26th Annual General Meeting held in Muranga today.
The member deposits grew by 7 percent to 7.5 Billion in 2018 compared to 7 Billion in 2017 while total expenditure grew by 14 percent to Sh1.5 billion in 2018 compared to 2017 when it was Sh1.3 billion. Total assets of Unaitas grew by 8 percent to Sh12.8 billion in 2018 compared to Sh11.8 billion in 2017.
Going forward Unaitas said that it will rely on strategic alliances and technology to grow their deposits, loan book, and recovery efforts.
“Most of the capital expenditure was used in putting in place a core banking, automation, and a digital system, investments that are beginning to impact the business positively by cutting off recurrent expenditures, said Unaitas CEO Martin Muhoho.
“We have automated all the loan processing facilities and this will go a long way in streamlining our operations while reducing our day to day operation costs.” Said Muhoho.
This year, the Sacco announced that it intends to focus on its expansion by opening up new branches in strategic locations to act as a hub for technology-based expansion.
“The performance targets are aligned in the spirit of enhancing a performance management culture,” said Kabugu.
World Bank pushes G-20 to extend debt relief to 2021
World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.
“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.
He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.
The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.
People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.
For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.
Debt burdens, already unsustainable for many countries, are rising to crisis levels.
“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.
Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans
The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.
“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”
According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.
Tighter Reins on Platforms for Mobile Loans
The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.
Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.
Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.
Scope Markets Kenya customers to have instant access to global financial markets
NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options.
This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.
The Scope Markets app offers clients over 500 investment opportunities across global financial markets.
The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.
The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).
The platform also offers an enhanced client interface including catering for those who trade at night.
The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour; Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).
The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.
Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”
He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.