Amica Sacco eyes KES1.6Billion in 2025 revenue, as MMF mulled

By Steve UMIDHA

 

Watch: https://www.youtube.com/watch?v=mjDR1OM8Z7s&t=47s

Amica Saving & Credit on Thursday said its revenue growth for the full year 2025 would hit Kes 1.6Billion with a net income of Kes 440million, as the Sacco looks to build on its impressive 2024 results when it posted Kes 1.3 billion in revenue, despite a wobbly business environment blemished by the Gen-Z protests.

To achieve this, its Chief executive Dr. James Mbui said the firm will spread its offerings to serve high-net-worth customers, including micro-savings groups or chamas, and institutions as well as safe investment opportunities “beyond traditional interest income to enhance our investment income.”

Read: Amica Sacco inks Kes300million loan deal with KDC to support SMES

One of those safe investments will include the launch of a new money market fund (MMF) product with relaxed risk management norms as the Murang’a – based Sacco seeks to give its customers a simple, faster and smarter way to invest and grow wealth.

“We are introducing a Money Market Fund account to meet the increasing demand from economically active Kenyans and to compete effectively with other investment companies in the market,” said Dr. Mbui during the firm’s 27th Annual Delegates Meeting (ADM) held in Maragua, Murang’a County.

Money Markets Funds (MMFs) are currently one of the most popular investment vehicles in Kenya today with a host of financial technology firms rushing to cash in on the model. This is due to the fact that, they invest in highly liquid securities like cash equivalents, government bonds among others therefore having a high degree of safety.

“It is a product that is going to rival what we are presently seeing in the market today,” said Mbui, noting that the company will sidestep the otherwise tedious regulatory sanctions that are synonymous with such undertakings. This is because it is already regulated by the SACCO Societies Regulatory Authority (SASRA).

“As a Sacco we are allowed to introduce any kind of a savings deposit because we are already a regulated institution…and so nothing requires us to go that direction,” noted Mbui.

MMFs are known to attract an array of investors, and today they are an indispensable cash management instrument for corporates, financial institutions, insurance companies and pension funds globally. Other users, like family offices and foundations, have also incorporated them into their day-to-day businesses.

MMFs are simply a pooled open-ended (mutual) funds that invest in short-term instruments, such as call accounts/cash, commercial paper, certificates of deposit, floating-rate notes, term deposits, repos, and government treasury or sovereign bonds, which typically have short maturity periods and are highly liquid. Similarly, they are used for diversification alongside traditional bank deposits.

Growth targets 2025

 

The Sacco which targets to grow its membership to about 15,000 this year, is also pegging its 2025 growth numbers to strategic partnerships with lenders extending flexible rates, eye marking entities like Commodities Fund and Agricultural Finance Corporation for its capital growth.

Amica had last year secured a loan facility of Kes300 million from the Kenya Development Corporation (KDC) under the SAFER project, and has since loaned out more than Kes 200 Million to its customers a host of which are in agribusiness as well as business individuals.

The Sacco has further embarked on a striving share capital drive that will see its members contribute Kes 1,000 annually toward shares, whereas borrowers will be required to make a contribution as part of the loan disbursement process.

“Additionally, we have introduced an internal share mobilization policy, where delegates, staff, and board members commit to monthly contributions toward share capital growth.

We also aim to have at least 50% of our active members contribute regularly to Investa Deposits, further strengthening our deposits mobilization,” said Jediel Kahungu, Amica’s National Board Chairman, adding that the Sacco will increase its share capital by Kes 150 million as well as grow its portfolio by Kes 1.2 billion and raise deposits to Kes 1.55 billion.