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LOAN QUALIFICATION

1. Only current and paid up KRB SACCO members who are at least six months old with the SACCO shall be eligible to receive loans from the SACCO.
2. Total loans outstanding for a member shall not exceed 3 times the member’s shares and deposits for members who are on long term employment at KRB. Members who are on short term employment at KRB shall only be eligible to receive loans equals to 1 time their shares/ deposits plus any funds that they can repay before expiry of their employment contracts, provided that the total loans do not exceed three times their shares and deposits. Outside members shall be eligible to receive loan not exceeding 2 times their shares.
3. Total deductions shall comply with the Employment Act and shall not exceed two thirds of a member’s statutory salary as evaluated by the employer.
4. Members may apply for refinancing of existing development loans and the outstanding loan balance shall be offset against the new loan. The refinancing of loans shall only be available when the SACCO experiences excess liquidity. No member shall be granted loan refinancing more than once per year.
5. Loans shall be granted on a first come first served basis. However, in cases of insufficient funds to meet the loan applications, preference shall be given to:-

• • • Emergency loans
    • First time applicants
    • Applicants with small loans (less than Kshs 100,000) if need and credit standing are nearly equal.
    • New development loans shall have priority over refinanced development loans.

1. Where loans applied for exceed the available funds necessitating reductions in the amounts to be given out, the Credit Committee may reduce the loans in proportion to each members’ deposits amongst the applicants.

LOAN SECURITY

All loans, except instant loans, shall be adequately secured. The following are the approved loan securities:

1. Guarantors – For all development loans at least four members with combined deposits equal or more than the loan amount applied for. For all other loans, at least two member shall gurantee the loan provided that the combined deposits equal the loan amount applied for.

In accordance with Clause 67 (a) of KRB SACOO bylaws, the management committee shall not accept as a guarantor, a member who himself has taken a loan and has already guaranteed a maximum of three development loans. In addition, the total amount of outstanding loans guaranteed by the member shall not exceed one and half times his total shares and deposits.

1. Deposits of loan applicant
2. Terminal dues
3. Other securities to loans (e.g. Car log book, title deed) as may be specifically approved by the management committee.

DEFAULT

A loan which remains unpaid 15days after the monthly installment due date shall be considered in default.

Any loan which remains unpaid for more than three months may be referred to the guarantors to make good.