Last Saturday we marked the 100th International Day of Cooperatives, a day designated by the United Nations to recognise and appreciate the role of cooperatives in helping their members achieve a common economic, social and cultural goal.
Savings and Credit Co-operatives (Saccos) have over the years played a very significant role in the growth and development of small enterprises.
In the past, Saccos restricted membership to certain groups such as employees of big companies, civil servants and farmers.
However, Saccos have since gone mainstream to incorporate everyone in the society with individual business owners, self-employed and small enterprises becoming the greatest beneficiaries.
My business mentor told me that a business is like the human body. Even those who enjoy robust health once in a while catch a cold, headache or stomach upset.
Among all challenges that businesses face from time to time the most frequent and potentially destabilising is the inability to get finances at the time it is required most. This may be occasioned by missed target, delay in getting paid or miscalculation on cash flow and cash projections.
This applies to all businesses regardless of size and financial strength.
However, whereas big companies can easily get a bank overdraft, loans or shareholders’ bailout to bridge the gap, most individual business owners don’t have such indulgencies.
This leaves small businesses at the mercy of friends, shylocks, suppliers or end up losing out on opportunities that mostly sprout out when one is low on finances.
But thanks to Saccos, many businesses are now able to access cash faster and at low cost.
Saving, one of the key tenets of Sacco, contrary to what many people think is not something you do when you have surplus. In business saving ought to be part of investment incorporated in the overall business plan, whether your business is struggling to pay other loans, is making profit or not.
Your Sacco is your best financial partner in your entrepreneurial journey helping you to save profitably and financing your business easily when in need.
I always advise small businesses and individuals to save their money in Sacco consistently regardless of their financial needs. It is the most reliable source of business financing nowadays.
The biggest advantage of saving in Sacco unlike in many other areas is that you are a member with a voice in management and a beneficially of profit made in form of annual dividends. In addition, you are guaranteed to get a loan of at least three times your saving at short notice and as long as you get three fellow members to guarantee you.
Unlike commercial banks and other lenders, Sacco loans have the lowest interest and terms that will not strain your business.
This year’s theme for International Day of Cooperatives is - “Cooperatives Build a Better World.”
As a beneficiary of the Sacco in one way or another, you are invited to build a better world by spreading the word about how Sacco are helping our society and encouraging people around you to be members, including your relatives and friends.
Mr Kiunga is a business trainer and the author of The Art of Entrepreneurship: Strategies to Succeed in a Competitive Market.
