New platform eases Saccos operations in face of pandemic
By CW Writer
A digital application to help Saccos continue with their operations in the face of the outbreak of the Coronavirus pandemic has been launched.
Digital banking platform Kwara announced the launch of Kwara Pronto digital banking platform which will be offered free for three months, in an effort to help Saccos at risk of disruption from the Coronavirus pandemic (COVID-19) to quickly go digital, remain in operation and continue serving members.
Due to government-enforced restrictions on movement and social distancing measures during COVID-19, Saccos are unable to operate at full capacity.
As a result, members face challenges applying for loans, transacting and accessing their funds.
Kwara is offering access to an essential version of its core digital banking platform, which will enable Saccos who qualify to quickly onboard and bring their operations online, at no cost, for the next three months in an effort to enable Saccos and their members to keep transacting while observing social distancing.
“The COVID-19 crisis will inevitably disproportionately impact the financially vulnerable, who rely heavily on Saccos for access to fair loans and a safety net when they need it,” said Kwara CEO Cynthia Wandia in a statement.
“Traditionally, Saccos rely on face to face interaction to serve their customers. Today they are facing significant challenges trying to operate in this new environment. Our platform is designed to kick-start their digital transformation, and we are offering an essential version of our platform for free, in an effort to do our part in ensuring they (Saccos) can continue serving the members that need them and get through these difficult times,” she added.
Kwara launched in 2018 in Kenya, offering a digital banking platform designed for savings and credit cooperatives.
Their new Pronto product will enable both Back Office Services Activity (BOSA) and Front Office Services Activity (FOSA) Saccos to quickly and easily go digital.
They simply need to provide minimum mandatory KYC requirements and a snapshot of financial data, all of which are protected under a Non Disclosure Agreement (NDA).
Staff can then start working remotely, process the high volume of incoming loan requests quickly, disburse funds, and easily get in touch with members.
Members, in turn, can begin to transact digitally and view their finances and loan eligibility in real-time. Eligible Saccos will also get a free website to enhance their digital presence.
“The Kwara core banking platform is stable and secure, and the team shows incredible dedication and commitment in providing support to its clients. I commend them in making an effort to focus on helping SACCOs keep issuing loans through this time,” said Kenya Bankers SACCO Chief Information Officer Steve Biko, of the company’s clients.
Backed by Finparx, Google for Startups, Catalyst Fund, Kepple and Bonum Ventures, Kwara serves more than 27,000 SACCO members via SACCOs including Kenya Bankers Sacco Ltd in Kenya and has over Sh8 billion in assets under management on its platform.
Meanwhile, the Digital Lenders Association of Kenya (DLAK) has agreed to waive the late repayment fees as part of the measures to support customers during this time of the COVID-19 outbreak.
DLAK which represents 17 major mobile lenders in the country says the move will cushion the customers who are under distress, following the slowdown in the economy after disruptions to their day to day operations that could have had an effect on regular income flow.
Customers are advised to seek more detailed information on the specific aspects of the waiver from their respective providers.
The Association also supports President Uhuru Kenyatta’s directive on the temporary suspension of the listing with Credit Reference Bureaus (CRB) of any person, Micro, Small and Medium Enterprises (MSMEs) and corporate entities whose loan account falls overdue or is in arrears, effective 1st April 2020.
Kenyans are already feeling the negative impact of the spread of Coronavirus as various companies continue to announce suspension of operations, layoffs or pay cuts, these effects are set to trickle down to the financial sector and more specifically mobile lenders who young people and small businesses depend on for micro-loans hence the need to cushion battered Kenyans.
The Central Bank of Kenya (CBK) has already projected that Kenya’s economy will fall to an eleven-year low.
Tala, a DLAK member has already announced the establishment of a Sh605 million COVID-19 rebuild fund to bolster Kenyan businesses and communities negatively impacted by the rapid spread of Coronavirus in the country.
The fund, which Tala plans to grow through additional funding and partnerships, will prioritise existing Tala customers as well as Tala businesses that provide essential services to their communities.
Eligible customers will be invited to apply for the fund’s first new product, a 0% fee, 6-month community support loan of Sh30,000, designed to support businesses that are helping Kenyans recover and rebuild.
“We believe small businesses are the backbone of the Kenyan economy. Businesses, and business owners, who provide essential goods and services to their broader communities will help Kenyans survive this crisis and will be on the front lines leading efforts to rebuild,” said Ivan Mbowa, General Manager, Tala Kenya in a statement.