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88. The Society may grant loans to members upon such securities and in such a manner as the committee may from time to time determine and upon such terms and conditions as to repayment rate of interest and the maximum amount.


a. In order to be eligible for a loan, a member must meet all the Conditions for membership with regards to the entrance fees and the minimum qualifying shares. He must also have been an active member for at least six months.

b. Loans to casuals shall be granted equivalent to their share / deposit.

c. Loans to contract members shall be given in consideration of period of contract. Under exceptional circumstance and where guarantors agree, those permanent contract loans may be given more than the period of contract by six months

90. All loans to members shall be approved by the full Management Committee.

91. No loans shall be granted which in the opinion of the Committee will not help to increase the income of the member and his general standards of living.

92. All loans shall be granted both for provident and productive needs of the members and shall be for a specific and approved purpose for a definite period of time and at a definite rate of interest.



a. Society shall operate under defined credit policy and procedures to manage credit activities as approved by members in an A.G.M.

b. All loans shall be applied for in the form provided for the purpose by the society.

c. The loan agreement will be signed by one witness and at least three guarantors. It shall be countersigned on behalf of the society by the authorized signatories of the society.

d. The agreement form shall clearly state the amount of the loans, the rate of interests, the date of the last full payment, the purpose of the loan, the guarantors and the nature of the security if any.


94. The committee shall ask for such security, as it may consider necessary. Land title deeds and vehicle Iogbooks will be allowed as security on condition that they are properly and officially charged to the society. The loanee will pay for the charges on valuation and safekeeping of such collateral’s at the bank. Every charge shall be registered by the Commissioner.

95. The share Capital of a member plus his Deposits shall be considered as a security when considering a loan.

96. A member can only guarantee four people at a time IN A YEAR and only up to his total shares and Deposits.

97. A borrower or guarantor may apply to the committee for a change of a guarantor and the committee shall not unreasonably withhold its consent.

98. Nothing in this section shall prevent the committee from using its discretion to grant a loan secured only on the known character, honesty and industry of the borrower together with the income earning prospects of the loan.

99. Chattels Transfer duly administered through a competent court of Law and registered by the Registrar General shall be accepted as security in place of guarantors if the member so wishes. Cost of administration of chattels shall be borne by the members.


100. It shall be the duty of the committee to take all necessary actions and precautions to ensure that a loan is used for the purpose for which it is given.

101. At every committee meeting the item “Loan” shall appear on the Agenda. The officer controlling the loan account shall report on:-

a. All loans due for repayment within the next 4 weeks.

b. All loans fully repaid since the last meeting.

c. All loans overdue for repayment and period of delinquency indicating details of the Ioanee’s Name, loan amount, shares, Guarantors and Security.

d. The committee shall take such action, as it deems fit with regards to all the above cases.

102. Any request for an extension of time in which to repay the loan shall be agreed by the Management Committee only in most exceptional circumstances and any extension so granted shall be treated as though it were a new loan and a new agreement shall be signed.

103. Any loan more than one month overdue shall be considered as delinquent loan and the Managing Committee shall take all necessary steps to recover such loan including recoveries from the Guarantors.



a. It shall be the duty of each member to report at once to the committee if he has to suspect-that a borrower is not using or has not used his loan in the manner for which it was granted or is behaving in a way which may endanger his ability to repay the loan at the due date.

b. Suspected borrower shall be called to appear before the Management Committee for vetting and appropriate decision will be taken to safe guard the interest of both parties.

105. For each breach of these By-Iaws or of instructions issued by the committee, in pursuance of general meeting resolutions the defaulting member may be fined an amount not exceeding KShs.20,000/- for each offence, subject to the provisions of Section 32 of the Act.

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