Tea is a major cash crop that is grown in Kenya which is one of the leading foreign exchange earner for the country.
Tea farmers Sacco’s CEO Isaac Omwenga expressed his concern about farmers who fail to pay loans in time because of hawking their tea, saying the Sacco has sometimes been forced to use guarantors to recover the money.
He noted that challenges such as farmers hawking their produce to multinational companies also reduced tea leaves delivered to Kenya Tea Development Agency factories.
The farmers sacco affiliated to Wakenya Pamoja savings and credit cooperative society have received a total of Ksh.862million bonus this year.
The officer said they recorded an increment of Ksh12 million up from what was paid last year.
Speaking in Kisii yesterday, Omwenga said they had projected to pay over a Ksh1billion but the harsh weather conditions experienced this year affected tea production and consequently farmers’ bonus.
He urged farmers who secured loans from the Sacco to use other sources of income to repay them to avoid such incidences in the future.
Omwenga also appealed to the farmers to find ways of increasing their production, plan before they secure loans and invest in viable projects that will increase their profits and enable them repay in good time.
Saccos pool shares and savings to build their own loan portfolio, without reliance on external capital or funding. The benefits to the SACCO include higher returns on their deposits through interests credited on their accounts and lower rates on loans.
It also provides members with much more than financial services, they seek to improve the livelihood of members by enabling them to own homes, fund children education and help in business start up.
Do you agree that the farmers are failing to pay loans in time because of hawking their Tea?