Factors to consider when choosing a SACCO Management Solution

Cynthia Wandia is the co-founder and CEO of Kwara.

The digital wave has welcomed a growing appetite for the traditionally known informal financial structures to develop and upgrade their operations to digital platforms. In Kenya, Savings and Credit Cooperatives have been shifting their operations to more automated platforms for a while now.

The directive from the regulator, Sacco Societies Regulatory Authority (SASRA) further fueled this phenomenon. SASRA had set a June 2021 deadline for all Non Deposit Taking SACCOs to have a Management Information System subject to their registration. Despite the need and the obvious benefits of migrating to a digital platform, the critical question narrows down to choosing the appropriate SACCO Management Solution for your SACCO.

There are a number of factors to consider before choosing a system to power your operations. Cost is definitely one of them. Smaller SACCOs with fewer assets and limited capital are likely to invest in a cost-effective SACCO solution that caters to their essential needs around compliance and security. Tier one SACCOs with millions in asset value are on the other hand likely to invest in a more expensive solution that will enable them to digitize most of their offerings and serve their members better. A shared Software-as-a-Service solution, however, enables SACCOs both large and small to access the same core infrastructure and allows for differentiation at the member level. This is a rising tide that lifts all the boats.

Great systems should also be user friendly. They should be easy to navigate and use. The system should have an interface that is easy to manoeuvre and learn. This is essential as it helps SACCOs to save on time and resources used in training their staff on how to use the system. A user-friendly system means less time on workflows and a shorter turnaround time. This ultimately leads to member’s satisfaction and loyalty.

Security is an issue of significant concern for any SACCO seeking to procure a digital solution for their operations. SACCOs need to ensure that the systems they are choosing have all the facets of security checked in order to secure their data and privacy. These could include the security of information stored in the cloud. There are a number of security concerns that different SACCOs prioritise but generally, every SACCO wants to ensure that their system is intact and their data is not accessed by any unauthorized third party. 

Getting a good system is only half the journey towards getting a good experience. You need top-notch and real-time support from your vendor in order to ensure consistent workflow. It's very important that the end-user can get support to resolve an issue as and when they occur. This establishes trust and confidence between the SACCO and the vendor and by extension the members. 

In addition, reliability is no longer negotiable. System downtime can cost the SACCO millions of shillings in lost revenue, as well as cause frustration to your members. Cloud-based systems should be able to demonstrate an availability of 99% at least. Some of the best are able to demonstrate 99.9% availability, taking into account well-communicated scheduled maintenance.

As SACCOs grow, the need to better manage information and interact with their members evolves. Therefore, they should ensure that they invest in a scalable solution. A good system should be flexible enough to allow adjustments depending on the current and future needs and conditions of the SACCO, particularly the ability to handle more and more transactions in parallel.

The system should have an open API. This means that the system allows third-party integrations with ease. APIs bring additional functionality which increases the value proposition and offering for your SACCO. You are able to achieve a lot more as a SACCO with a system that allows multiple other applications to plug into it than a system that is rigid.

These seven factors are what most SACCOs consider before procuring a SACCO Management System. The priority obviously varies per SACCO but generally, they determine the decision-making process for most SACCOs before settling on a system.

You need to ensure that the SACCO solution you choose will help achieve what your SACCO aims for and most importantly what your members need.

The writer is the co-founder and CEO of Kwara