Saccos worried with RBM directives

Chairperson of Auction Holdings Limited (AHL) Sacco, James Kondowe, says the directives coming from Reserve Bank of Malawi (RBM) demanding that Saccos be run as banks are shrinking Saccos profits and may force some to close.

Speaking during an AHL annual general meeting on Saturday Kondowe said RBM could have consulted Saccos before coming with regulations to govern the running of Saccos.

According to Kondowe, some of the new regulations demand that all Saccos should have 10 percent of liquidity, construct cubicles in the banking halls, all members should have non redeemable shares and that all employees working in Saccos should be well qualified to handle money.

“We are not fully happy with the directives from RBM. They did not consult us when coming up with these regulations and most of our members are not happy with this. What they want us to do is to turn into banks when we are not ready,” said Kondowe.

He said the decision to make cubicles is very expensive and has eaten into the profits of many Saccos and the decision that 10 percent of the total revenue for the Sacco should not be touched is going to make small Saccos bust.

But Muscco IT officer Daniel Imfa said RBM did a survey and discovered that Saccos are handling large amounts of money.

“It is true that RBM did not consult but the reforms that they have set up will at the end of the day assist the Saccos to be run professionally. I believe RBM and Parliament want to safeguard people’s money and the directive will hurt for a short time but in the long run all Sacco members will benefit,” said Imfa.

Imfa said premises where money is kept should be well protected hence the decision by RBM to demand that Sacco offices must have banking halls.

“Some cashiers were putting money in drawers and this is risky and it should be stopped,” said Imfa.