Automation of SACCOs - FSD Kenya

70 • AUTOMATION OF SACCOS: ASSESSMENT OF POTENTIAL SOLUTIONS
FOSA Strengths Weaknesses / For further investigation
Loan application processing The system offers a range of options to configure the loan product. The vendor has provided the following
The key ones are:
clarification:
• payment schedule (set up per individual loan).
The outcome of appraisal process can be
• payment method.
overridden but only by authorised users.
• (no) capitalisation of interest.
(Project team note: this would in fact be an
• different interest calculation options (simple, add-on, amortised, important strength and should be moved to
in advance).
the left column in the report with the comment
• different disbursement options.
above).
The system offers a range of options to configure the loan issuing
process. The key ones are:
• verification of security using borrowers’ shares, collateral, and
guarantors.
• separation of collateral into different types and specification of
their market value/loan ratio.
• configuration of statements.
• prioritisation of payments in case of delinquency.
The system gives reasons for rejections from
a list of reason codes supplied by the Sacco
during implementation. These are user defined
and even a provision for putting additional
comments is provided.
The system provides a delinquency
management /product control feature by which
interest beyond a certain point can be set to
zero.
Pre-payments and partial payments are supported.
The system can instantly generate updated
payment schedules when payment method
is changed and is not dependent on the EOD
procedure being executed.
The system includes a workflow-like feature taking the application
to each subsequent step.The system features what-if analysis to
illustrate the change in payment schedule given different assumptions
and choices.
Apart from the base rate, a margin interest per customer-productrelation
can be added.
Customer data management
Credit, collateral, and collection The system can classify loan performance according to the WOCCU
categorisation.
The system can produce letters for collection.
Accounting and finance
General accounting The CoA is fully customisable.
The system enables the user to specify how transactions are to be
posted based on e.g. product or transaction type. An administration
module tracks any incorrectly posted transactions.
Tax rates can be set up and tax can be withheld automatically.
The vendor has provided the following
clarification:
Credit scoring is not part of the offering defined
above but provided through an additional and
optional Orbit module.
Reporting and provisions for loan aging can
be made automatic given the latest version of
Orbit.
The system only supports reconciliation through
an additional module.
Fixed assets The system does not offer any functionality
to track fixed assets. Fixed assets have to be
managed using an additional module.
Planning The system does not offer a module or
functionality dedicated to planning.
Treasury and cash
management