Nairobi, Kenya, Aug 31 – Stima Sacco’s new Chief Executive Officer (CEO), Chris Ngeta Useki has set his eyes on anchoring the society on excellent customer service as a key differentiator at a time when the financial sector is going through a turbulent period.
In an interview with Capital Business, the CEO who took over the society on 18th August 2017 said customer satisfaction will be high on his agenda.
“I’m very keen on excellent customer service and how I’m going to deliver it to the members. I’m very keen on ensuring the members are happy with the society,” he said during the interview.
The Sacco’s backbone has been the member’s deposits and interests charged on loans but the new CEO is keen on diversifying products, and ultimately revenue for the 100,000-strong SACCO.
“We need a total solution to our members. If they are in need of a mortgage, insurance products, retirement or Islamic banking, we should be able to provide all round service for them,” he said.
Useki is keen on ensuring that society’s members are provided with what he calls a 360 degrees service provision.
“We don’t want our members to have any problems. Not when they are young, not when they are middle aged and certainly not when they are retired. We want them to be totally dependent on the Sacco,” he asserted.
For the last 5 years, the society embarked on a rapid expansion mission spreading its wings, setting up branches in Mombasa, Kisumu, Nakuru, Nairobi’s CBD, Olkaria and Embu. Useki admits that while most financial institutions are moving towards mobile banking, the Society member’s uniqueness will force it to have its footprint in different areas.
Useki admits that while most financial institutions are moving towards mobile banking, the Society member’s uniqueness will force it to have its footprint in different areas.
“Our foremost strategy will be to leverage on technology. As much as we will not emphasize brick and mortar and physical branches, you realize that our members are of all types, from all walks of life and we would need certain foot prints in some areas,” Useki noted.
On competition from commercial banks
Sacco’s advantage over commercial banks had always been low-interest rates mostly issued at 12 percent per annum on development loans borrowed against one’s deposits.
However, Useki admits that the introduction of the amended Banking Act in 2016 has affected the Sacco. To stay ahead of the competition, the society has chosen the path of product diversification.
“Yes, it (amended Banking Act in 2016) has impacted on us. However, the overall effect has not crippled the Sacco. We are working on diversifying sources of financing e.g. to the retirees, diaspora, we are looking for money from all over so that we can cushion ourselves from any challenge,” he commented.
The Society embarked on a charm offensive targeting Kenyans living abroad to bite a chunk of the over 150 billion annual remittances. The new CEO said that they will still continue on that path but with caution owing to the slippery nature of the Diaspora market.
“We are just about to finish preparing Diaspora policy. We are not going to shelve the question of Diaspora but we are going to approach it cautiously taking into account that it is a very costly and risky kind of market,” Useki said.
On dividends and interest rebates, Useki says that his work will be to ensure that members get at least an equivalent percentage of what they received in 2016.
“We do not foresee a situation where we will go down for any reason,” he affirmed adding that “We are diversifying sources of financing and revenue streams so that we don’t entirely rely on interest funded income. In our estimation, we are going to cushion against any pitfall that we might have experienced last year.”
In October 2016, media reports alluded that the former CEO was suspended for allegedly risky, reckless lending, a rumour Useki is quick to dismiss adding that lending is naturally a risky affair.
“The former CEO actually resigned,” he clarified adding that “It is important to note that lending in the first place is a risk.”
Exuding confidence, Useki lauded the steps the society has taken to minimize all manner of risks that might affect the society.
“We now have an enterprise risk framework, an entire department to deal with liquidity risks, market risks and all manner of risks,” he said.
He also emphasized that the International financial reporting standard nine (IFRS 9) which is set to come into effect in January from 2018 will greatly improve their buoyancy against risk.
“IFRS nine will require financial institutions that do lending to provision much more so that they cushion themselves against risk. We are going to ride on that alongside other manners of managing lending risk so that we can have a much healthier book,” he concluded.
Stima Sacco’s Asset base stands at Sh 26.3 billion, a loan book Sh 21.2 billion, deposits of Sh 20.8 billion and Membership of 102 000.
Useki has been Acting CEO since 18th October 2016 of the 43 year-old Society.
Useki is a seasoned accountant with 16 years of experience in financial management. He was appointed as the Sacco’s Internal Auditor in 2002 and was later promoted to the position of Finance Manager in 2006.
He joined the Society from CMC Aviation Limited and had earlier worked with Mastermind Tobacco (K) Ltd.
He is a member of the Institute of Certified Public Accountants of Kenya (ICPAK) and is a Certified Public Accountant of Kenya (CPA-K) and also a Certified Public Secretary (CPS).
Useki holds an MBA and BCom in Accounting from the University of Nairobi and graduated from the Strathmore Senior Management Leadership Programme in December 2015.