The Co-operative Bank has collaborated with stakeholders in the coffee industry to ensure that farmers are paid at the same time as other service providers such as brokers, millers, and warehouse owners. This is achieved through a direct settlement system that has been implemented in the coffee sector by the Co-operative Bank.
According to CS Chelugui, the Co-operative Bank will set up accounts for coffee farmers to ensure prompt payments similar to those of other service providers. This will eliminate the long wait for payments, making the coffee sector more appealing, especially to younger individuals.
Additionally, the Co-operative Bank is involved in supporting various efforts to rejuvenate the cotton sector, establishing connections for potato farmers, and providing support to key players in the dairy industry.
“We have new KCC and Meru Dairy, which had virtually collapsed but got a Co-operative Bank bailout. Today, Mount Kenya, which is based in Meru, is the market leader in terms of collection and processing of milk. They collect milk from Embu, Tharaka Nithi, Meru, Nyeri, and Laikipia, equivalent to 560,000 liters per day and sell 1,120,000 packets per day. Farmers receive their dues before the cow is milked. An estimated KSh 1.4 billion is paid out every 5th of the month to milk farmers in Meru. The quality of life in Meru has thus changed considerably with a rise in disposable incomes in this county, through the dairy sector value chain,” said CS Chelugui.
According to him, the impact of the co-operative sector can be seen in the way the dairy industry has influenced Meru town and its surroundings.
Co-op Bank distributed over Ksh 5.8 billion in dividends to its shareholders, with the co-operative sector being the primary beneficiaries. This significant distribution of dividends showcases the Bank’s impact on the strength of the co-operative movement. This institution serves as a beacon of hope and inspiration for the 14 million co-operators through its good governance, appropriate policies, and the right mindset.
“The Bank’s determination to succeed should inspire the Sacco movement. In Colombia, Saccos dominate the transport sector and own buses, airlines, banks, hotel chains, and virtually everything in Colombia. This achievement could be replicated by the movement in Kenya,” said CS Chelugui.
The CS encouraged Saccos to consider the possibility of operating a railway line through a concession and expanding their investments in other modes of transport, emphasizing that they should not limit themselves to owning matatus.
