How to Buy Shares in a Sacco [2022]

Savings and Credit Cooperatives, Saccos has lifted the economic lives of many Kenyans. Mention a Sacco, and any Kenyan will associate the word with savings, dividends, shares, and loans. Apart from many households casting their trust in Saccos, many have also embraced the saving culture to enable them to secure loans for development.

Though different Saccos operate differently in regard to interest rates, management, and policies, many of them have similarities in several ways. One of them is the need to buy shares before you become a member. Maybe you would want to understand what shares are before the details of how they work.

What are Shares?

Share refers to money invested in a Sacco by a shareholder—a simple definition. It represents a share of a member’s ownership of a Sacco. You cannot withdraw your shares if you decide to part ways with the Sacco, but you can only transfer them to another member.

How to Buy Shares

You could be wondering how to buy shares in a Sacco. Right? The process of buying shares in a Sacco is not complicated but involves a simple procedure. What do you need to do?

1. Sign Up for the Saccos Membership

You may not be able to be counted as a shareholder of a Sacco before becoming a member officially. You, therefore, need to legalize your membership by

• Filling out the membership application form, which requires your full name, date of birth, ID number, email address, bank, and details, among other things.
• Pay membership fees. The fee varies in amount depending on a Sacco. Some require as little amount as Ksh.500 while some will charge as much as Kshs.10,000. The payment is once in a lifetime.
• Your monthly minimum contribution. The amount also depends on a specific Sacco. You will have to pay the amount monthly, though.

2. Obtain a Unique Membership Number

After fulfilling all of the requirements you will be given a unique membership number. The number acts as your identity in the Sacco. All transactions and fillings bearing your name will be done against the unique number. It will ease record-taking since using real names may be tedious. Some Saccos have thousands of members with a lot of records to keep and numerous transactions to make.

3. Buy Shares of the Sacco

After acquiring the membership, you will buy a share in the Sacco to obtain full membership. Various Saccos have a different amount as the share capital. There are some with a minimum share capital of Sh 5,000. Some, over Sh 50, 000. It would be wise if you inquire about the exact amount before joining a Sacco.

Why do you need to buy shares in a Sacco?

The main purpose of joining a Sacco is to save and get loans for personal development. The money you deposit plus your shares will be the basis of your borrowing. The money can multiply into more cash which can help you have the opportunity to borrow more.

Don’t forget about dividends. It is the money you get annually at an interest rate on your savings and shares. So, having good shares and savings in a Sacco will be like winning a jackpot at the end of the year. Besides, shares also give you the powers to become a co-owner in the Sacco.

Parting Shot

According to SASRA (Saccos Societies Regulation Authority), there are over 200 registered Saccos in Kenya. All of them are in the market looking for members. It will be upon you to identify legit, licensed, and financially stable Sacco which fits your financial needs. Apart from their dividend rates, you can look into their investment plans.