WHY YOU SHOULD CONSIDER BEING A MEMBER OF A CO-OPERATIVE SOCIETY

Why you should consider being a member of a co-operative society.

By Vera Shawiza

Suppose you have made the wise decision

of saving and investing for your future.

Where would you put your money? In a

Co-operative Society or a Savings and

Credit Co-operative Society? Maybe both?

Before deciding where to put your

finances, it is important to understand

the difference between the two. Co-

operative Societies and Savings and

Credit Co-operative Societies (SACCOs)

are often confused by some people and

used interchangeably. However, they are

different from each other. While a co-

operative promotes the welfare and

economic interests of its members and is

open-ended in its operations, a SACCO

is limited to holding savings and

providing credit to its members. Members

of SACCOs collect financial resources

together and borrow from them according

to their shares.

In Kenya, co-operative societies are

vastly distributed across agricultural

and non-agricultural sectors like

housing and transport. They include

members from different groups who come

together to promote a common goal.

According to the International Co-

operative Alliance, co-operatives are

open to all persons who are able to use

their services and are willing to accept

the responsibilities of membership.

They have the right to join the society

when they wish and leave it at their own

will.

A co-operative society is also open to

all persons without gender, social,

racial, political or religious

discrimination. However, co-operative

societies formed for particular groups

may limit membership to only those

groups. For example, a teachers’ co-

operative society may restrict non-

teachers from joining in and a farmers’

co-operative society may limit their

membership to only include farmers.

Co-operatives are controlled by their

members who actively participate in the

co-operative’s decisions and policy

making. They are generally managed by a

committee elected by the members at

annual general meetings.

In co-operatives established by

individuals, members have equal voting

rights where each member is entitled to

only one vote regardless of the number

of shares they hold.

Members contribute equitably and control

the capital of the co-operative. They

are entitled to receive limited

compensation on the capital they

subscribe as a condition of membership.

They can allocate surpluses to develop

the co-operative, benefit members in

proportion to their transactions with

the cooperative and support other

activities approved by the members.

Co-operatives have the freedom to act

independently to govern themselves and

set their own operational rules. They

are controlled by their members and if

they enter into agreements with other

organizations, including governments, or

raise capital from external sources,

they do so on terms that ensure

democratic control by their members and

maintain their co-operative autonomy.

However, it is important to note that

this does not exempt co-operatives from

government regulations and laws that

govern co-operative societies. In Kenya,

co-operatives are governed by the Co-

operative Societies Act.

Co-operatives train and educate their

members, elected representatives,

managers and employees so that they can

contribute to the co-operative’s

development. Different co-operatives

offer different types of training to

their members. There are also

specialized training institutions that

offer training curriculums which can be

adopted by different societies.

Co-operatives co-operate among

themselves to support, promote, and

develop other co-operatives. They work

together through local, national,

regional and international structures to

strengthen the co-operative movement.

An example of this is the Co-operative

Alliance of Kenya (CAK) which consists

of National Co-operative Organizations

(NACOs), Co-operative Unions and Primary

Co-operative Societies. Co-operatives

also come together on International Day

of Co-operatives, ‘Ushirika Day’, to

celebrate achievements made by co-

operatives and to increase their

awareness.

Co-operatives work for the sustainable

development of their communities through

policies approved by their members.

They are based on the values of self-

help, self-responsibility, democracy,

equality, equity, and solidarity and

contribute to the growth of their

communities by investing locally.

Understanding the difference between a

co-operative society and a savings and

credit co-operative will allow you make

a wise decision when it comes to

achieving your investments goals.

Joining a co-operative society like

Safaricom Investment Co-operative means

pooling resources to ensure that every

member of the society is empowered

economically. You can join the co-

operative either as an individual member

or a group member and enjoy membership

benefits like discounted and subsidized

prices and priority on products and

projects offered. https://sic.co.ke/