Kenyan cooperatives roll out joint tech platform to protect members’ funds

The Co-operative Alliance of Kenya (CAK) has launched a Sh800 million technology platform that seeks to protect depositors’ funds in savings schemes against the rising cases of fraud.

The Co-opTech platform, a financial technology company owned by the co-operative lobby, will oversee safety of the depositors’ funds through a joint platform that will be used by all Saccos in their daily transactions.
Kenya’s Co-operative minister Simon Chelugui said the platform was long overdue as the idea was mooted a while back.
“The system will ensure the security of depositors’ funds in Saccos and assure them of the safety of their money in accounts,” said Mr Chelugui, noting that technology has become an integral part of business. He said innovation plays a major role in sustaining co-operatives by offering the ability to manage resources, improve efficiency and create products and solutions in line with their needs.
Saccos will own the platform by buying shares. Small Saccos will pay between Sh350,000 and Sh500,000 while the big boys will part with up to Sh10 million as a one-off payment.
“Saccos pay up to Sh1.5 billion every year to different service providers who offer them a technology platform to protect deposits of their members,” said Daniel Marube, chief executive officer of CAK.
The new platform, Marube said, will save money, enabling the Saccos to extend loans to their members at affordable rates.
The new technology is aimed at making affordable core banking services for saving schemes that have been struggling to raise the huge budget to procure and maintain versatile transaction systems to deter fraud.
“The shared transaction platform will enhance reliability, cyber security and make affordable services similar to the banking sector,” Marube said.
The platform is embedded with a shared fund management system that supports inter-sacco lending.