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Differentiate between Share Capital, Savings/Deposits and Equity Shares

1. Share Capital

What are shares/Shares Capital?

• Share Capital is the equity (core capital) of the SACCO divided into affordable shares that give an opportunity to every Member to own a piece of the Society.
• Each registered SACCO Member hold at least one share valued at Kshs. 100/= each
• Share Capital is Transferrable – SACCO facilitates – Earn Dividend annually.

Who is eligible to purchase Boresha SACCO Shares?

• Existing Members - All Persons, Institutions or groups registered as Members i.e Salaried, Kilimo, Biashara and Corporate Members.
• New Members – individuals who wish to buy shares join to be Members first.

How much shares can a Members Purchase?

• Members can buy unlimited number of shares subject to the following
• Salaried Members - Minimum-300 shares; Ksh. 30,000/=
• Kilimo or Biashara Members - Minimum- 30 shares; Ksh. 3,000/=
• Institutions /Groups - Minimum- 50 shares; Ksh. 5,000/=
• Note - Members are encouraged to buy more than the minimum set minimum above
• There is no Maximum amount, provided that no single member buys share capital more than one-fift (1/5) of total Share capital. Currently share capital is 6.1 Billion

Benefits of share Capital to Members

• The shares continue to earn Guaranteed Dividends annually of not less than 10%. This year Dividend rate of 12% was paid
• Dividends Rate and Value of shares will grow with growth of the SACCO
• Ownership of a stable SACCO and strong SACCO – Be proud owner.
• Be highly honoured Member and leave inheritance to future generation.
• Enjoy a variety of products and Services at afforadable and flexible terms
• Shares may be sold or transferred to another Member through the SACCO.

Benefits of Share Capital to the SACCO.

• Share capital finances the Growth of the SACCO Business of Savings and Credit.
• Lending using own funds is cheaper than Bank loans which attract huge interest.
• Reduction of Bank Loans drastically leads to good returns for Members.
• Provides adequate funds for lending and stability – Improved liquidity.
• A strong capital base enables the SACCO realize its strategic focus.
• Develop products and services offered conveniently using modern technology.
• Steady growth of the SACCO thus attracting more Members, hence more business.
• Quick loan processing and new additional products and Services – improved income.
• Avenue for the SACCO to raise additional capital – strong base.

2. Savings/Deposits

• This the amount contributed monthly through check in Members payslips – 10% of basic pay.
• Savings/Deposits is withdrawable – Lien for loans - Earns interest annually.

Benefits Savings/Deposits?

• Deposits/Savings is personal future investment, on Retirement a Member can withdraw all or part Savings accumulated. Retirees are however encouraged to continue being Members of the SACCO to enjoy benefits of a Member and Micro-credit Products.
• Deposits/Savings at the end of the year earn Interests. Interest Charged on Loans is ploughed back to the Member as a percentage of Shares, Savings or Deposits.
• Members Welfare Fund benefits - On demise, Loan is written off against the Fund and Savings in COSA (back Office) is multiplied by two then paid to the Next of Kin. In addition, Bereavement Claims is paid for Parents, Spouse or Child.
• Provide a Right of Membership. Ownership of the SACCO and the right to make decisions for the Society.
• Deposits/Savings is Security to your own and guarantee to other Members’ Loans.
• Self Guarantee – A member with substantial Savings can be a self guarantor.

• Equity Shares
• This is Equity contribution by salaried Members. Initial Equity shares was used to build own magnificent Offices – Teachers and Mwalimu Plazas.
• Equity Shares facilitates the growth and expansion of SACCO Business through Front Office Services Activity (FOSA) and buildings.
• Salaried Members are owners of Equity shares up to a minimum of Ksh. 25,000/=, however Members are free to purchase up to a Maximum of Ksh. 200, 000/=. One share is Ksh. 1000/=.
• New Members automatically contribute Equity shares after three (3) Months of Membership through check-off Ksh. 500/=.
• Equity share holders earn Bonus on Equity shares at the end of every year
• Equity shares is non-withdarawable but may be transferred to another Member or Next of Kin