Why SACCOs Are Rocking Africa’s Financial Future

Imagine a financial haven built by your neighbours, for your neighbours. SACCOs offer a lifeline of financial services – from savings accounts to loans – tailored to everyday needs. They’re not just about money, though. SACCOs are about building a stronger community, brick by brick. They support local businesses, invest in education initiatives, and empower individuals to chase their financial dreams.

But wait, there’s more! SACCOs are embracing the tech revolution. By harnessing the power of technology, they’re streamlining operations, making life easier for members, and extending their reach to even the most remote corners. Imagine accessing your account, applying for a loan, or transferring funds – all with a few taps on your phone.

Security and compliance? Don’t worry, SACCOs have got you covered. They’re implementing robust systems to protect your hard-earned cash. But it doesn’t stop there. SACCOs are constantly innovating, creating new services and solutions that cater to the evolving needs of their members.

So, the next time you think about your financial future, remember the local heroes – the SACCOs. They’re not just about saving money, they’re about building a brighter future, one community at a time. And here we have Henry Abea, ICT Manager of the biggest SACCO in Kenya, Mwalimu National SACCO, sharing his lessons leading IT projects for SACCOs in Kenya.

Who is Henry Abea? Can you discuss your experience and background in IT leadership within the SACCO sector?

Henry Abea is an IT and digital transformation evangelist with over 17 years of experience in the financial services industry. He began his career as a systems administrator in 2006 in a tier-three SACCO and has since grown to become the ICT Manager and ICT team lead of Mwalimu National DT SACCO, the largest SACCO in Kenya and Africa by asset base. His journey, while challenging, has been rewarding, allowing him to make significant contributions to several SACCOs, including Sotico SACCO, Orthodox Dev SACCO (Miliki SACCO), Elimu SACCO, and Kimisitu SACCO.

As an IT leader, what qualities do you value in your team?

I value a team that is agile, responsive, and proactive. An IT leader has many responsibilities, and a supportive team is essential. Collaboration among team members is crucial to ensure seamless service delivery, even in my absence.

With almost two decades in the making, what would you say are your good and bad memories as an IT leader?

Over the last 17 years, I have many good memories, including winning the CIO100 Bronze Award on the first attempt and later helping my previous employer win a gold award in the SACCO sector. This recognition reflected our hard work in delivering digital transformation and providing top-tier services through technology. On the downside, service downtimes related to breaches or technology failures are particularly painful. These incidents disrupt customers, whose satisfaction we strive to maintain. During such times, the phone doesn’t stop ringing, whether from colleagues, industry players, directors, or even family. No IT leader wants these moments, but we must ensure service resumes as quickly as possible with minimal interruption.

If you were to start your career again afresh, what would you do differently?

I would do the same things again because the journey has been fulfilling, and I have no regrets. However, I would focus more on creating networks, as I have realised the importance of networking, especially in the tech space and financial services industry.

How does the technology you manage contribute to financial inclusion in underserved areas?

At Mwalimu National DT SACCO, technology ensures that members across the country, including remote areas, receive services conveniently. Mobile banking services, ATM coverage, and branch networks powered by technology enable this. Through technology, we provide affordable services that would otherwise be expensive to access in urban areas. The expansion of our common bond to include members from other sectors of the economy is a deliberate effort to reach unbanked populations and provide them with efficient, seamless, and affordable financial services.

How have you used technology to solve challenges affecting the SACCO sector in Kenya?

I have used technology in various ways to address sector issues:

• Entering new markets and offering innovative products and services suited to SACCO members’ needs, such as mobile applications, member portals, and credit scoring using metadata and AI algorithms.
• Enhancing service delivery through mobile banking technology, allowing members to apply for loans, get guarantors, calculate loan eligibility, and access funds conveniently.
• Investing in cybersecurity to protect member funds and maintain financial health and trust.
• Reducing costs by automating processes, minimizing human error, and improving payment collection systems for faster, more efficient transactions.

With years of experience running IT departments, how do you handle failure?

When an idea fails, I try multiple methods, seek help from others, and conduct further research. This approach helps me learn new ways to solve the problem. I don’t dwell on failure but learn from it to avoid repeating the same mistakes and to improve continually.

Which emerging technology trends do you anticipate will have the most profound impact on SACCOs in the coming year?

I anticipate that Robotic Process Automation will become prevalent and hyper-personalization will be a key competitive area in the SACCO sector.

What is the most valuable piece of advice you’ve received in your career, and how has it influenced your professional journey?

In 2014, when a vacancy for the ICT Manager position arose, the CEO encouraged me to take the role and showcase my ability to transform the SACCO. This opportunity drove me to excel, and I spent nearly seven years in that role, making significant contributions. This experience instilled in me a continuous drive for improvement and transformation.

For emerging leaders in the technology sector, what qualities and skills do you consider essential for success?

Essential qualities and skills include empathy, good communication, decision-making, resilience, delegation, collaboration, self-awareness, agility, and problem-solving abilities.

How do you measure the success of IT initiatives in a SACCO, and what metrics do you use to evaluate their impact on organizational performance?

I measure success through:

• Member adoption rate of new services or products.
• Customer satisfaction scores obtained from regular surveys or assessments.
• Return on investment (ROI) by comparing implementation costs to revenue generated or cost savings achieved.
• Time to market.

How do you approach vendor selection and management for IT solutions in SACCOs, and what criteria do you consider when evaluating potential vendors?

Key criteria include:

• Trust, which develops over time and through first impressions.
• Industry research and due diligence checks.
• Compliance with legal and regulatory frameworks.
• Flexibility and adaptability.
• Long-term perspective and stability of the vendor.

What lessons have you learned from past IT projects in SACCOs, and how have these lessons influenced your approach to future projects?

Lessons learned include:

• The importance of thorough testing throughout the project cycle.
• The need for clear and consistent communication.
• Documenting everything for future reference.
• Gathering user requirements to ensure smooth project execution.
• Considering all costs to avoid surprises during the project.

What are the key IT projects you have led or implemented in SACCOs, and what were the challenges you faced during these projects?

I am currently leading a significant digital transformation journey at Mwalimu National. In the past, I have implemented projects such as ERP systems, core banking systems, member portals, mobile applications, e-board systems, document management systems, infrastructure projects, business intelligence systems (Qlik), wide area networks, and B2B integrations.

Challenges included costs, resource constraints, approval challenges, scope creeps, risk management issues, lack of clear objectives, change management challenges, and competing organizational priorities.

How do you prioritise IT initiatives within a SACCO, considering factors such as budget constraints and organisational goals?

Proper and prior planning, a well-drafted budget, approved annual workplans, and an ICT strategy aligned with the organizational strategy help navigate constraints. I prioritize initiatives that offer the most returns and value, particularly those that enhance customer engagement and related returns.

In your opinion, what are the current IT trends shaping the SACCO sector, and how do you stay updated with these trends?

Current trends include AI, IoT, blockchain, edge computing, augmented reality, big data, and cloud computing. I stay updated through research, watching documentaries on technology evolution, and participating in tech forums.

What’s the future of SACCOs through the technology lens?

SACCOs are evolving and becoming key players in financial inclusion and services provision. They are now competing with banks in terms of member/customer engagement and technology adoption. I foresee virtual SACCOs emerging, where the focus will be on the ease and convenience of accessing services rather than physical locations.

We’ve talked about work all through so what do you do outside work?

I play football with local clubs like Kick Off and Super Select. I also enjoy playing pool, scrabble, and table tennis in my free time.

In five years, I see myself as an industry powerhouse in the financial services sector, a mentor, and a tech leader revolutionizing service delivery through technology in Kenya, Africa, and globally. So, help me God.