Filling the shoes of great and successful predecessors comes with great responsibility. Mr. Peter Ngugi, the new chairman of the fast-growing Tower Sacco, is determined to stoke the frame and make his mark. His is a well-cut-out job that he is well-prepared and psyched to execute.
“As long as better is possible, good is not good enough. We will try to our best level to apply this principal day by day, we must ensure the vision of the Sacco founders and leaders lives on,” he says.
Tower ranks among the rapidly rising Saccos, according to the Sacco Societies Regulatory Authority (SASRA) ratings, with a reputation for offering bespoke and affordable financial solutions and high returns on members’ deposits.
“Our successes over the years have been largely driven by integrity and innovation. If you go out there and do today what you were doing yesterday, you’re effectively going backwards,” he says. “We’ve got to keep our word and be reinventing things constantly in order to stay ahead of the game and build loyalty.”
On Mr. Ngugi’s shoulders is a great responsibility to steer the giant Sacco to new heights and achieve its ambitious 2021-2026 Strategic Plan targets. He says they cannot rest on their laurels but will keep innovating. “You get contented; you fail to think outside the box.”
“We want to grow our total assets to Ksh30 billion by the year 2026 and by 2030 when the Sacco will be clocking 50 years attain an asset size of Ksh50 billion. In the span of 10 years we also intend to increase our membership by 40,000 yearly, an average of 3,500 members every month,” he avers, oozing confidence.
The Sacco has phenomenally spread its wings to eight counties, Nyandarua, Laikipia, Nakuru, Samburu, Narok, Nairobi, Kiambu, and Kilifi, with a 25-branch network. “We intend to open marketing offices in Wamba to adequately serve our members in the vast Samburu County and in Kinamba, Subukia and Njoro towns once we get SASRA approvals,” Mr. Ngugi says.
Since 2006, Mr. Ngugi notes, when the Sacco opened a branch in Engineer Town, it has been a trail of achievements for Tower, but the big breakthrough came in 2011 when it opened the common bond.
“To build sustainable business units, the Sacco leadership and management benchmarked with leading institutions and Saccos. This enabled us to establish satellite offices to serve our growing and diverse members closer and better, the results have been good.”
The Sacco has about 200,000 members currently drawn from various sectors such as business people, jua kali, horticulture, transport industry, civil servants, and institutions, among others.
With its total assets valued at about Ksh20 billion and a loan book worth over Ksh16.2 billion, Tower Sacco ranks among the largest Tier 1 deposit-taking Saccos nationally. Over the last five years, the Society has paid dividends on shares at 20% and interest on deposits at 13%, making it a lucrative investment institution. Members pocketed Ksh 1.67 billion in annual earnings early this year for FY 2022.
“We have seen members embrace this Sacco because of quality and affordable financial products and highest payment on annual returns. The highest dividends we have paid to an individual is Ksh20 million and the highest loan to an individual is about Ksh180 million,” says Mr. Ngugi. Its list of millionaires has over 1,000 members.
At the heart of Mr. Ngugi’s responsibility is to ensure that the Sacco lives up to its core values: integrity, confidentiality on all Sacco matters, efficiency and effectiveness, teamwork, equality and equity, creativity and innovation.
“Teamwork is paramount to ensure that there are good working relations. We will also rely on our data to know the areas that need attention and understand our members better to tailor-make products to meet their desires and needs.” Besides, the Sacco has established strategic partnerships to maximize members’ benefits.
With accolades for being the best in technology optimization, Tower Sacco’s robust core banking system has made it possible to roll out a successful banking agency and a secure mobile banking platform.
“As a board, we want to increase the number of our Sacco Agents from around 300 to over 1000, to open up business and create jobs. We also intend to enhance our customer service, and leverage on ICT, while mitigating cyber threats,” says Mr. Ngugi.
The Ol’Kalou-based Society has built a strong liquidity position through prudent management and convenient banking services, adequately meeting members’ loan demands and investing excess cash in government securities.
“As much we want to release good payment to our members, we want to grow our reserves by keeping our income-expenditure ratio below 25:26,” says Mr. Ngugi. He notes the towering Sacco plaza in Ol’Kalou was completed at the minimum cost, adding that for over 10 years, the Sacco has never borrowed.
“As long as better is possible, good is not good enough. We will try to our best level to apply this principal day by day, we must ensure the vision of the Sacco founders and leaders lives on.”
– Mr Peter Ngugi, Chairman, Tower Sacco
The Sacco’s business model focuses on low-income earners to transform their social-economic status.
“We have realized that you do not necessarily do business with high-income earners; you need to go to mama mboga, kiosk owners and bodaboda riders. We speak and listen to understand them, incorporate and train them. If you lend money to people without financial training and education or financial management skills, they will default,” Mr. Ngugi explains.
He notes that the Sacco has customized its products to suit different market segments, trained staff on customer service, embraced digitization and upholds integrity to build members’ confidence.
The institution also engages young people to help them innovate as white-collar jobs become scarce. “Unless our young people become innovative and see what they can do with borrowed funds to transform this country, they will lose focus,” he says.
“We are educating our youth that to be in business and to grow, you must be tenacious and focused. We are also encouraging them to be entrepreneurs so that they look at every opportunity as a business opportunity. The culture of starting small income-generating projects while waiting for some white-collar job should stop.”
He says that starting an income-generating project should not be a pass time thing, but the youth should be innovative to improve it to standards that customers like, earn good money, and employ others. “You’ve got to be brave and hold your breath sometimes; success takes time,” he advises young people.
Mr. Ngugi explains Tower Sacco has innovatively developed products such as asset financing, makao loan (mortgage) and stop-gap (a retirement product) to uplift members’ living standards.
Leadership is not a Mr. Burns-style autocrat; for Mr. Ngugi, today’s successful managers must be as transparent, accountable and empathetic as anyone below them.
A teacher by profession, Mr. Ngugi has adopted a transformational leadership style. He traces his leadership traits back to primary school. From a young age, the responsibility to lead fell on Mr. Ngugi’s shoulders. He was a prefect at Sibara Primary School and head boy at Ndaragwa High School. He is now a headteacher at Parkview Primary School and JSS in Aberdare sub-county, Nyandarua County, and a church elder and congregation chairperson at PCEA Subuku Church, Kanyagia Parish in Ndaragwa Presbytery. He has also been a CIC delegate for 18 years and is the current National Secretary of the Kenya Teachers Saccos Association (KETSA).
His Rise to the helm of Tower Sacco leadership started in 2000 when, at 31, he contested to be a board member and won. Since 2004 he has been serving as the Sacco Board Honorary Secretary until his ascension to the chairman’s seat in February 2023, taking over from Mr. John Gitundu.
With his hands full, Mr. Ngugi, a father of three, says as a leader, one should give themselves out and create time. “This needs passion and commitment to balancing. We keep God first; all our meetings start by prayer,” he says, adding: “You have to have a listening ear.”
Having served on the board for 23 years, Mr. Ngugi, who also holds a diploma in Education Management and Guidance Psychology, has what it takes to propel the Sacco to the next high level.
“Saccos are the way to go. Ten years ago, during zonal teachers’ meetings, you could hardly see a vehicle in the compound; today you hardly get a parking space. A vehicle is not a priority; it tells that they have been able to accomplish something else and bigger,” Mr. Ngugi says.
He attests that he has seen members grow businesses, build houses, acquire land and get quality education through the financial support of Tower Sacco.
“To the person out there yet to join a Sacco, Tower Sacco is the best to join. No day that you will apply for a loan and you are told to wait for the money. Your issues will be responded to immediately, we give the best services and we have a variety of products, you can choose from. You can never miss anything, Tower Sacco is a basket for all your financial needs,” he says proudly.
“The achievements of our members are a testament that Tower Sacco is a performer. Their success stories tell the success story of Tower Sacco.”
“We have seen members embrace this Sacco because of quality and affordable financial products and highest payment on annual returns. The highest dividends we have paid to an individual is Ksh20 million and the highest loan to an individual is about Ksh180 million.”
– Mr. Ngugi
