How saccos can retain senior citizens as lifetime members

 

An elderly man reads details on a credit card. Retirees have a lot to offer saccos as they control substantial amounts of deposits and assets. Fotosearch 

By Isaiah Opiyo

During the recent Ushirika Day celebrations hosted in Nairobi, I encountered Gaudencia, a 75-year-old retiree, who had joined her sacco members to celebrate the International Co-operative Day.

Since she retired from public service almost a decade ago, Gaudencia has continued to retain her membership in the sacco despite loss of her monthly payslip.

But she intimated that some of her peers rushed to terminate their sacco membership on retirement to access their deposits. She revealed that her borrowing appetite had declined as she has no regular source of income to commit for loan repayment. This, she said, is one of the numerous reasons why many retirees opt to walk out of their saccos.

Retaining retirees as lifetime members is a challenge for many saccos, yet retirees control substantial amount of deposits and assets in saccos. Any mass withdrawal would lead to erosion of deposits and share capital base.

Below are ways saccos can nurture lifetime membership among retirees:

Create a unique membership category for retirees

Retirees have unique needs that may not be fully met by the conventional sacco products and services. This is because they have low borrowing appetite and sometimes they may be devoid of a regular source of income to commit to regular savings contribution.

Saccos can create a unique membership category to cater for such. This category of “senior citizen” would have unique features such as low minimum monthly saving contribution or no monthly savings contribution but with a compromised dividend payment rate.

Provide dividend management plan and advisory

Paying dividend income earned from the sacco in lumpsum may disorganise retirees financially, especially those who have no regular income and have to meet their monthly saving contribution set by the sacco.

The sacco can provide a dividend management plan that would involve making some cash deduction from the dividend income earned to cater for the required monthly savings contributions while the balance is distributed into a monthly income.

Develop unique savings product A significant income earned by retirees goes towards medical expenses for recurrent illnesses associated with old age.

Since majority of retirees would be tempted to withdraw their deposits from the sacco to cater for such expenses, developing a saving product that has a medical cover component to augment medical expenses would go a long way.

Nominate retirees as mentors or ambassadors of the Sacco

Retirees can be given opportunity or roles as mentors to shares with younger members why they need to enhance their savings contribution and retain their membership in the sacco for their whole lifetime.