They’ve established themselves as a reliable source of low-cost loans and savings options. In contrast to banks and other formal businesses, growth has occurred without the use of numerous technology enhancements.
As members of SACCOs were unable to meet in person and deposit their savings due to the spread of the COVID-19, a race to digitalization ensued. Furthermore, owing to the travel limitations, they were unable to apply for loans and get funds. Even though several SACCOs are moving toward digital systems for simplifying their operations, several areas of their operational processes continue to be manual. They primarily communicate in person and maintain records using traditional methods. However, technology adoption has been progressive.
In the digital transformation era, SACCOs must understand their members’ growing expectations and deliver seamless services to meet those needs. SACCOs should concentrate on members’ touchpoints, as well as digitized customer experiences such as omni-channel banking, self-service portals, Mobile Wallets, and WhatsApp Banking.
Accelerating SACCO Digitization with Core Banking Solution (CBS):
Digitization of SACCOs enhances operational efficiencies, transparency, and strong security. In addition, it enables SACCOs to expand their financial services and cut down overall costs by a huge margin.
Core banking solutions are centrally managed systems for financial organizations that automate the frontend and backend procedures to ensure a consistent workflow. SACCOs can upscale their productivity by digitizing many processes with the help of core banking solutions. It can assist them in solving current difficulties and preparing for future challenges, in addition to improving operations with digitization.
Let’s take a closer look at the key benefits of Core Banking Solution for SACCOs.
Enhanced Efficiency:
Members of SACCOs often spend a lot of time in maintaining records. Whenever a deposit is accepted or a loan is approved, they must manually record the information. It takes a significant amount of time and effort for SACCOs. There is a significant chance of an error or a fault in manual processes.
SACCOs can increase their productivity by using a core banking solution to automate entries such as deposits and loans. They can save a substantial amount of time that would otherwise be spent on manual entries and corrections. This would not only save their time but will also allow them to double their efforts on community development.
Reduced Costs:
Most businesses are being compelled to function with a cost-effective approach due to the current economy. SACCOs can minimize costs while enhancing income with the proper solutions. With a core banking solution, SACCOs would not have to think about security or maintenance expenditures as their solution provider would take care of that too.
The introduction of core banking systems has significantly lowered SACCO’s operational and support costs. Customers no longer need to visit bank locations because services such as mobile/internet banking are available through many channels. SACCOs have been able to save significantly on infrastructure and operating expenditures because of this. Improved operational efficiency has led to the reduction of cost, better transaction speed, and smoother loan processing. Additionally, core banking solution allows SACCOs to better serve their consumers and maintain a favorable relationship with them.
Data Analytics:
SACCOs amass a large consumer database through the registration procedure. They can make data-driven decisions on product development, loan restructuring, and marketing with the support of a digital solution that has data analytics or business intelligence capabilities.
Members of SACCOs have a variety of expectations, so products that meet those requirements are sought. SACCOs can use data analytics to segment members and offer products and services that are tailored to their specific requirements.
Growth with Automation:
Automation of processes can help SACCOs boost capacity and increase revenues dramatically. Admins can use their time to churn new ideas and ways to expand as many admin-related activities will be fully automated with a core banking solution. Better growth potential will also result in more members and more profitability. SACCOs will also be able to gain new business opportunities by collaborating with banks and microfinance institutions to provide better services and generate consistent income.
Compliance Management:
SACCOs can take advantage of the core banking solution’s in-built compliance management features for Banking Laws, Regulations, and Validations. Financial statements, Asset and Liability Reports, NPA reports, and Large Currency Transaction Reports are all generated automatically by core banking solutions for regulatory authorities like the central bank. It enables SACCOs to avoid repetitive tasks and concentrate more on providing better services to their members.
Security:
SACCOs can benefit from the high-level security and anti-money laundering capabilities of a core banking solution, resulting in a more solid and elevated IT infrastructure with minimal business disruption. This protects SACCOs from losing revenue due to fraudulent activities, which could lead to member loss owing to trust issues.
Extended Business Footprints:
SACCOs can use core banking solutions to extend their market reach by automating processes and providing seamless services to unbanked communities in rural and sparsely populated locations. The solution also provides a holistic picture of each member’s profile as well as the member’s overall financial transactions with the SACCO.
Empower Digital Transformation with Panamax’s MobiFin CBS
SACCOs are not just a way to save money, but also a solid approach to meeting investment and insurance requirements. For them to satisfy evolving demands and provide improved services, digitization through core banking solutions could be an important factor. It can assist SACCOs in being automated, reliable, and accessible in their dealings. They can significantly cut the overall cost of operations and will be able to reach a larger market to get more customers.
MobiFin is a SaaS-based Core Banking Solution (CBS) with a “Digital” focus, designed largely to address IT challenges and digitalization aspirations for SACCOs. In contrast to distributed traditional systems, unified data is available at the exact time, with the freedom to select the optimal set of functional modules. It integrates seamlessly with several digital channels, including ATMs, Tellers, Service Outlets, IVRS, Mobile Banking, Net Banking, and others, to improve customer experience.
