The digitization of SACCO is supported by three key arguments. The first is that people in all parts of the world, especially in Africa, are very comfortable with mobile financial services. When it comes to mobile financial services like mobile currency, mobile banking, and so on, Africa is a huge market. It also has a lower banking penetration rate, which makes the unbanning process more difficult. It also has a lower banking penetration rate, which means that unbanked people depend solely on SACCOs for credit and savings. As a result, it’s only natural to marry them together.
The COVID-19 pandemic is another argument. To combat the spread of the COVID-19 pandemic, the payment industry and banking sector have had to implement social distancing initiatives. SACCOs can be digitized to make all transactions paperless, clear, quick, and safe. It can also significantly reduce the total costs of SACCOs. SACCOs can benefit from digitization by being able to provide their financial services to people from all over the world. With their new digital offering, SACCOs can also attract a younger customer base.
The use of mobile money for purchases also eliminates the need for members to physically travel to collect or repay cash. This will save SACCO members time and effort while also improving the customer experience. It will also remove the dangers of dealing with physical cash. To build a digital dimension or ecosystem, an advanced and robust digital platform may combine multiple SACCOs with similar community savings models. Members will have access to their digital money accounts in this ecosystem, where they will be able to deposit and withdraw funds directly into SACCO’s digital wallet.
Members may also use this interactive platform or program to make loan requests. The loan can be disbursed via mobile money transfer once it has been authorized. Members may also use mobile payments to repay their loans. Aside from withdrawals, deposits, and loans, the digital platform can accommodate a variety of other financial services.
