Africa-Press – Eswatini. Having gotten over the disappointment of investing in a multi-million state-of-the-art building that later stood out as an eye sore white elephant in the capital city until recently, the country’s cooperatives movement is ready to dream once again.
The latest dream is in the form of a cooperatives bank as the movement engages in a massive digitisation programme led by Mambu as a core banking engine.
This comes after the Eswatini Association of Savings and Credit Cooperatives (ESASCCO), formerly SASCCO, invested in the then building in Mbabane that was left incomplete for over 10 years and was later purchased by the Public Service Pensions Fund (PSPF).
Savings and Credit Cooperatives (SACCOs) were told during the ESASCCO Annual General Meeting (AGM) this week that engagement of the Bankers Association with the view to establish a working relationship by the executive manager was being conceived.
They were further told that a cooperative bank concept note at the level of ESASCCO was being developed, which shall be a tool by which all stakeholders are engaged.
Outgoing Secretary General, Mpendulo Ngcamphalala, told the delegates during the AGM that DGRV, which is a cooperatives apex in Germany, brought the dream to ESASCCO that local cooperatives should form their own bank as opposed to using others that were privately owned.
He said DGRV had a memorandum of understanding (MoU) with government through the office of the commissioner of cooperatives to help develop SACCOs in the country.
“Their mandate in the country is to nurture us towards eventually establishing a cooperatives bank. They will not leave the country without seeing us establishing the cooperatives bank.
The minister (of commerce, industry and trade) has also promised that in the coming years he would ensure that he tables regulations that would in turn allow us to form the cooperatives bank,” he said.
Meanwhile, outgoing ESASCCO President, Winile Vilane, recently told the various SACCOs chairpersons that research conducted by various entities had shown that SACCOs were lagging in the digitisation of their products and services.
She added that such made them seem old school and many of their customers tend to rely on other institutions for some services that otherwise could have been provided by SACCOs.
“This puts, SACCOs in a compromised position in customer satisfaction and loyalty. As a result, SACCOs in Eswatini moved to source a core banking engine as a springboard towards improving customer satisfaction and loyalty to digitise their products and services. Mambu, as a core banking engine, was selected because of its potential in improving the banking services and products among SACCOs and membership,” she explained.
She added, “About five years or so ago, ESASCCO got into a partnership with a South Africa-based NGO of German origin by the name of DGRV. The organisation supported SACCOs to adopt and utilise the Mambu Core Banking Engine to serve members through ESASCCO.
“This partnership was formalised through a MoU ending in December 2024. Moreover, the MoU extended the catchment area to other SADC countries including Kenya. Currently, the operations of the core banking engine have extended to Lesotho and South Africa as well.”
In 2023, she added, ESASCCO signed a five-year contract with Mambu service provider, also German-based, which authorises ESASCCO to own the licence at subsidised rates for a contract duration of five years with a possibility of renewal at reasonable rates.
She added that by the end of 2023, in Eswatini 11 out of 14 SACCOs were active in the system (with about 25 000 SACCO members active and transactions ranging between E500 to E800 million), in South Africa five out of eight SACCOs are active in the system and Lesotho, only two SACCOs are enrolled in the system.
She added that Mambu is a cloud-based core banking engine that presents better opportunities than enterprise resource planning (ERP) tools given the future of technology.
“The core banking engine (Mambu) has high security proven by the experience of 2023 where one SACCO was reported to be one of the top institutions in the Southern Africa region that experienced multiple attempted hacking incidences which failed anyway.
This was reported by the ICT security team from the Royal Science and Technology Park (Eswatini).
“The system was given to ESASCCO on premise pro bono, which makes SACCOs pay licences at subsidised rates (E5 per month per member).
It can easily integrate with other financial services systems like mobile money, UNAYO (Standard Bank), accounting system (Microsoft 360, Surge Pastel, etc.), and insurance products at the same time presenting opportunities for revenue generation through other services.”
She said it uses real-time calculations of interests and presents various monitoring reports for proper decision-making by staff, management, and Board.
“The ESASCCO Board agrees with the fact that this will grow into an autonomous business entity since SACCOs in the country aspire to have their bank in the near future. The plan is to mobilise SACCOs to have confidence in the platform to adopt it for use marking the full-fledged rollout of the platform across the SACCO industry.
“This shall also include the provision of extended banking services and products to SACCOs through the Mambu Core Banking Engine,” she added.
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