Saccos hand  slum youth a chance to dream big

A new sacco movement which seeks to change the fortunes of the youth is slowly taking shape.

The initiative is being unveiled alongside the slum upgrading programme by the ministry of Devolution.

It is expected that the saccos will hold billions of shillings in deposits and could soon rival mid-tier banks once the project is rolled out across the country.

Youth from Nairobi’s slums engaged in the cleaning of drainage systems and sewer lines, construction of toilets and collection of garbage, among other activities, have formed saccos where their daily savings are remitted. The plan, which has become a government flagship initiative, was launched in Kibera with 4,000 youth involved.

Smart Company visited the ongoing second phase of the project in Mathare, Korogocho, Mukuru kwa Njenga and Kiandutu where 13,789 youth are currently engaged. The young people are paid Sh471 daily and the payments are wired to them every week.

However, Sh141 from the daily pay is remitted to their individual saccos formed for each village in the slums.

The five slums have a total of 39 villages, meaning 39 saccos receive Sh1.9 million daily from the youth. In the six months that the youth will be involved in the project, the saccos will be holding close to Sh120 million in deposits.

The youth have also been grouped in tens and they may soon get loans from the saccos and start businesses.

BOON FOR YOUTH

Mr Frederick Oduor, 23, is one of the young people whose life is gradually being transformed by the new initiative. He says he was on the verge of getting into drug  abuse but now the project keeps him busy and assures him of a weekly income. This, he adds, has revived his hope for a better life.

“At first, I thought it was not real until I got the first payment sent to my phone and everything started changing. I bought a mattress and started eating healthy,” he says. “Crime has reduced here and we have stopped taking drugs. I hope this contract will be renewed so that I can buy a motorbike and start making more money from my sacco savings.”

The youth, who have signed a second three-month contract will earn a minimum of Sh39,600 each at the end of the contract when they work during official schedules only. Some youth, however, work during weekends and engage in extra duties to earn more.

Previously, a majority of the youth had no source of income and the new project is a boon to them. The mobile money companies are also reaping big from the projects as the youth receive their wages through mobile phones.

The project has brought much more than financial benefits for the youth. After the regular duty that ends at 4.00pm, they are trained on values such as patriotism, obedience, discipline, teamwork and positive thinking. 

Some of them have even begun dreaming big. Levy Amumbo has a vision for his Kwa Kairuiki Huduma Group; to own a poultry farm and a posho mill when the project ends.

“I dropped out of primary school and I have been staying alone for the last seven years without any reliable income. I will ensure that my group adopts my proposals so that we don’t slide into poverty again. My mother is almost fully reliant on me now,” said the 27-year-old.

The youth will also access government tenders under the 2013 presidential policy directive that reserved 30 per cent of government tenders for the youth, women and the disabled. They will also have cheaper access to credit.

“We will ensure the person who wants to borrow has a clear objective and that we also lend those we are sure will repay. We are grouped from the same villages, have worked together all this time and we know each other too well to make any blunders,” said Mr Kennedy Munga, a youth leader from Mathare 3C.

CHALLENGES GALORE

The projects, which involve constructions of lighting masts, abolition blocks, police stations, sample residential houses and clinics in every village, have also become training grounds for the youth who have learnt important skills.

A source privy to the project told Smart Company that the programme will this week be rolled out in other counties outside Nairobi.

Lenders who will secure the deposits from these saccos will also smile all the way to the bank.

The implementation is not easy though, a half a day walk through the slums is not for the faint-hearted.

Space is scarce and even government land including road reserves and sewer lines have been occupied. 

The approach used is meant to have minimal confrontation reducing the government to be a beggar for its own land in the informal settlements where lawlessness is rampant.

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Devolution CS Ms Anne Waiguru’s response to Smart Company’s queries on the new project: 

VISION

NYS plan to transform lives of youth 

To date, how many youth have benefited?

Ms Anne Waiguru: A total number of 20,000 youth have been recruited directly into NYS. Another 24,600 youth have benefited  as community youth cohorts working in the various youth empowerment programmes. These are youth from Kibera, Mathare, Korogocho, Mukuru kwa Njenga, Kiandutu, South C and Gikomba. 

How many saccos are operational and how much savings have been made?

Ms Waiguru: NYS has registered 16 saccos in Kibera, 12 in Mathare, nine in Korogocho, 10 in Kiandutu,  two in Lambwe and nine in Kisumu.  Only 16 saccos in Kibera are operational. NYS is in the process of (setting up) the rest in the mentioned places. Total sacco deductions for all operational saccos in Kibera is almost Sh200 million. 

Is there a plan to bring the individual saccos together to form an umbrella body?

Ms Waiguru: The most important thing for now is to make the individual saccos operational and strong on their own. A union  for cooperatives can only be strong if primary cooperatives are strong. 

What are the safeguards put in place to ensure continuity of the youth groups and saccos once the programme ends?

Ms Waiguru: To sustain the continuity of saccos, members are trained on the culture of savings and repaying their loans.  The members will be trained and encouraged to start micro enterprises through acquiring credit from the saccos.

NYS has started a number of projects including urban farming, posho mills, fish tanks, rabbit farming and the ablution blocks which have already begun bringing some income to the saccos. 

How is the plan of  expanding the programme outside Nairobi unfolding?

Ms Waiguru: Apart from the informal settlements mentioned above, the Youth Empowerment Programme is currently being replicated in Kiambu and Kisumu County. President Uhuru Kenyatta will on June 1 flag off the Youth Empowerment Programme in other 21 counties.