Terms & Conditions — Testimony Staff SACCO

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1. Definitions & Interpretation

ARTICLE 1

1.1

"Society" / "SACCO" means Testimony Staff Savings and Credit Co-operative Society Limited, registered under the Co-operative Societies Act, Cap 490, Laws of Kenya, under Registration Number CS/4621/2019.

1.2

"Member" means any person admitted to membership of the Society in accordance with these Terms and Conditions and the By-Laws.

1.3

"Committee" means the elected Management Committee comprising the Chairman, Vice Chairman, Secretary, Treasurer and Board Members duly elected at the AGM.

1.4

"Employer" means Testimony Faith Homes & School, Nairobi, Kenya.

1.5

"Savings" means the accumulated monthly contributions deducted from a member's salary and held on their behalf by the Society.

1.6

"Shares" means the ownership units held by a member representing their equity stake in the Society.

1.7

"Reducing Balance" means interest calculated only on the outstanding loan principal at the time of calculation, not on the original loan amount.

1.8

"AGM" means the Annual General Meeting held each year to declare dividends, elect officials and transact Society business.

1.9

"By-Laws" means the rules, regulations and by-laws of the Society as registered and amended from time to time.

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2. Society Details

ARTICLE 2

Full Name

Testimony Staff Savings and Credit Co-operative Society Limited

Registration No.

CS/4621/2019

Address

P.O. Box 2134 – 30100, Eldoret, Kenya

Telephone

053-2062714

Governing Law

Co-operative Societies Act, Cap 490

Employer

Testimony Faith Homes & School

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3. Membership

ARTICLE 3

3.1

Membership is open exclusively to staff of Testimony Faith Homes & School on permanent, contract or casual employment terms.

3.2

An applicant must complete the official Application Form for Membership, providing true and accurate personal information, employer details, and next of kin information.

3.3

The application must be approved by the Committee. Upon approval, the member is assigned a unique Member Number (format: HM001) and is issued a Welcome Letter.

3.4

An Entrance Fee is payable upon joining. Members who previously exited and wish to rejoin must pay a Re-entrance Fee. Both amounts are set by the Committee from time to time.

3.5

Membership status types are: Active, Suspended, Exited, and Settled & Closed.

3.6

A member who resigns, is dismissed or ceases employment with the Employer shall notify the Society in writing within 30 days and shall settle all outstanding obligations before exit.

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4. Membership Obligations

ARTICLE 4

4.1

Every member agrees to abide by the Co-operative Societies Act, the Rules made by the Cabinet Secretary responsible for co-operative development, the Society's By-Laws, these Terms and Conditions, and any amendments made from time to time.

4.2

Members must maintain minimum monthly savings contributions as determined by the Committee and authorize their employer to deduct the same from salary on a monthly basis.

4.3

Each member must pay a monthly Benevolent Fund contribution of KES 200, deducted together with savings.

4.4

Members must promptly notify the Society of any change in employment status, contact details, or next of kin information.

4.5

Members must provide true, accurate and complete information in all applications, declarations and correspondence with the Society. Providing false information may result in suspension, disqualification from benefits, and possible legal action.

4.6

Members must maintain a minimum of one (1) share for as long as they remain members of the Society.

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5. Savings & Shares

ARTICLE 5

5.1

Monthly savings contributions are deducted directly from the member's salary by the Employer and remitted to the Society. The member irrevocably authorizes such deductions upon joining.

5.2

A member's savings balance is 100% owned by the member and will be refunded in full upon exit, subject to settlement of all outstanding obligations to the Society.

5.3

A member's savings balance directly determines loan eligibility: higher savings enable higher loan limits. Members are encouraged to maintain and grow their savings.

5.4

Shares represent the member's equity ownership in the Society. Members own a portion of the Society proportional to their shares relative to total Society shares.

5.5

Shares may be used as loan security. Where shares have been pledged as security, the member may not withdraw them until the secured loan is fully repaid.

5.6

Savings and shares are protected assets — they do not lose value and are not subject to market risk within the Society.

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6. Dividends & Annual General Meeting

ARTICLE 6

6.1

Dividends are declared annually at the Annual General Meeting (AGM). The surplus (profit) for the financial year is calculated, and a portion is set aside for distribution to members.

6.2

Each member's dividend is proportional to their savings balance relative to total Society savings. A member holding 5% of total savings receives 5% of the dividend pool.

6.3

Dividends may be paid in cash or reinvested into the member's savings account — the member's choice, declared at the AGM.

6.4

All members are entitled to attend and vote at the AGM. Each member has one vote regardless of savings balance or shares held.

6.5

Dividend payments may be attached in settlement of outstanding loan obligations where a member is in default at the time of distribution.

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7. Interest Rates & Charges

ARTICLE 7

Normal Loan

1.2%

per month on reducing balance

Salary Advance

4.2%

per month + insurance on reducing balance

Emergency Fund

4.2%

per month on reducing balance

School Fees Loan

4.2%

per month on reducing balance

Benevolent Contribution

KES 200

per month (non-refundable)

Processing Fees

None

no hidden charges

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Reducing Balance Explained: Interest is calculated only on the outstanding principal — not the original loan amount. As you repay, your monthly interest decreases. Example: KES 100,000 at 1.2% → first month KES 1,200 interest, reducing each month thereafter.

7.1

Interest rates are set by the Management Committee and may be revised from time to time. Members will be notified of any changes at an AGM or through an official communication.

7.2

There are no processing fees, administration charges, or hidden costs on any loan product offered by the Society.

7.3

Early repayment of any loan is permitted at any time with no penalty charges.

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8. Normal Loan

ARTICLE 8

8.1

Maximum amount: Up to 3 times the member's savings balance at the time of application.

8.2

Interest rate: 1.2% per month on reducing balance. No processing fees or hidden charges.

8.3

Repayment period: Up to 24 months in equal monthly installments, deducted from salary.

8.4

Eligibility: A member must have been in continuous membership for a minimum of 3 months before applying for a Normal Loan.

8.5

The application must state the purpose of the loan. Disclosure of all existing bank loan balances and other loan deductions is mandatory.

8.6

A minimum of 4 guarantors (up to 15) who are active SACCO members are required. Guarantors must sign the Loan Agreement Form and are jointly and severally liable. See Article 13.

8.7

Security for a Normal Loan may be provided through SACCO shares and/or pension. A SACCO Officer must sign to verify shares and an Accounts Officer must sign to verify pension.

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9. Salary Advance Loan

ARTICLE 9

9.1

Maximum amount: KES 6,000 per application.

9.2

Interest rate: 4.2% per month plus insurance premium, both calculated on reducing balance.

9.3

Repayment period: Maximum 3 months. The loan must be repaid in full within three months from the date of disbursement.

9.4

The Treasurer is authorized to deduct all repayment installments, interest and insurance premiums directly from the member's salary each month.

9.5

Where pension has been pledged as security, the member undertakes not to seek withdrawal of such pension from the Employer until the Salary Advance is fully repaid.

9.6

Security is provided through shares and/or pension. Signatures of both a SACCO Officer (shares) and Accounts Officer (pension) are required on the application form.

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10. Emergency Fund

ARTICLE 10

10.1

Maximum amount: Up to 1 times (1×) the member's savings balance.

10.2

Interest rate: 4.2% per month on reducing balance.

10.3

Eligibility: Available from the first month of membership — no minimum membership period required.

10.4

Emergency types covered include: Medical, Funeral/Death, Fire/Disaster, Urgent School Fees, and Other genuine emergencies as approved by the Committee.

10.5

Relevant supporting documents must be submitted with the application (e.g. Hospital Report, Death Certificate, Police Abstract, School Invoice).

10.6

The applicant declares that all information is true, agrees to the repayment schedule, consents to verification, and accepts the Society's terms and By-Laws.

10.7

Decisions are made by the Treasurer, Chairman and Secretary. Outcomes are: Approved, Rejected, or Pending further documentation.

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11. School Fees Loan

ARTICLE 11

11.1

Interest rate: 4.2% per month on reducing balance. Repayment period and monthly installment agreed at time of approval.

11.2

The loan is for education financing for the member or their dependants. Eligible education levels: Primary, Secondary, College, University, and Vocational/TVET.

11.3

Full student details are required: name, relationship to applicant, ID/Birth Certificate number, and class or year of study.

11.4

Payment may be made directly to the institution or to the applicant, as indicated on the application form and approved by the Committee.

11.5

Supporting documents required include a Fee Structure and/or Admission Letter. Previous academic results may be requested.

11.6

The applicant declares all information true, agrees to repay as scheduled, and accepts the Society's terms and By-Laws governing loans.

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12. Benevolent Fund

ARTICLE 12

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The Benevolent Fund is a non-repayable welfare benefit — it is NOT a loan. Members contribute KES 200/month to this fund and may claim assistance during qualifying life events.

12.1

Qualifying events: Death of Member, Death of Spouse, Death of Child (under 18), Death of Parent, Critical Illness of Member, and other welfare needs as approved.

12.2

Applications must be submitted within 30 days of the qualifying event. Late submissions may be declined.

12.3

Supporting documents required: Death Certificate, Burial Permit, Hospital/Doctor's Report, Birth Certificate (for children), Marriage Certificate (for spouse), as applicable.

12.4

Payment is made by bank transfer or mobile money to the account details provided on the application form.

12.5

All claims are handled with full confidentiality by the Committee.

12.6

Providing false information in a Benevolent Fund claim will result in immediate disqualification and may attract legal action.

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13. Loan Security & Guarantors

ARTICLE 13

13.1

Normal Loans require a minimum of 4 guarantors, all of whom must be active members in good standing. Up to 15 guarantors may be listed.

13.2

Guarantors are jointly and severally liable for repayment of the full outstanding loan amount in the event of the borrower's default.

13.3

In the event of default, the Society may recover outstanding amounts from guarantors through any or all of the following methods:
(a) Offset against guarantor's shares (b) Attachment of guarantor's monthly salary (c) Attachment of guarantor's pension (d) Attachment of guarantor's dividends (e) Attachment of guarantor's personal property

13.4

A guarantor shall not be eligible for any new loan from the Society while the amount in default for which they stand as guarantor remains unpaid.

13.5

Acceptable loan security includes SACCO shares (verified by the SACCO Officer) and/or pension (verified by the Accounts Officer).

13.6

Where pension is pledged as security, the member and any relevant guarantor may not seek to withdraw that pension from the Employer until the loan is fully repaid.

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14. Loan Repayment

ARTICLE 14

14.1

All loan repayments are made through monthly payroll deductions authorized by the member at the time of loan application. The member irrevocably authorizes the Treasurer to instruct the Employer accordingly.

14.2

Monthly installments comprise principal repayment plus interest on reducing balance, plus any applicable insurance premium.

14.3

Early repayment of any loan in full is permitted at any time. No early repayment penalty is charged.

14.4

Repayment periods by loan type:
Normal Loan: up to 24 months | Salary Advance: maximum 3 months | Emergency Fund: as agreed at approval | School Fees: as agreed at approval

14.5

Missed or late payments are recorded and may negatively affect the member's future loan eligibility and standing with the Society.

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15. Default & Recovery

ARTICLE 15

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A member is considered in default when any loan repayment is overdue. Persistent default may result in suspension of membership and enforcement action.

15.1

In the event of default, the Society may recover outstanding amounts through: (a) offset against the member's savings, (b) offset against shares, (c) salary attachment, (d) pension attachment, (e) dividend attachment, (f) attachment of personal property, or any combination thereof.

15.2

The Society shall pursue recovery from guarantors in accordance with Article 13 where the primary borrower is unable to repay.

15.3

A member in default is not eligible for any new loan from the Society until the default is fully cleared.

15.4

Loans overdue by 90 or more days are classified as bad debt and may be referred for legal recovery at the Society's discretion.

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16. Loan Approval Process

ARTICLE 16

16.1

All loan applications are reviewed first by the Treasurer, who assesses the member's loan balance and monthly deductions and provides a comment.

16.2

The Credit Committee then declares whether the applicant qualifies or does not qualify, and the approved amount in KES (written in words and figures).

16.3

Final approval is granted by the Executive Committee (Chairman, Secretary, Treasurer), specifying: loan amount in words and figures, repayment period in months, monthly installment, and interest rate.

16.4

The Society reserves the right to decline any application without being required to provide reasons, acting in the best interest of the Society and its members.

16.5

A unique Form Number is assigned to every application for tracking and audit purposes. Members may reference this number in all correspondence regarding their application.

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17. Exit & Withdrawal from Membership

ARTICLE 17

17.1

A member wishing to exit must submit a written notice to the Society. Exit is effective after all outstanding loans and obligations have been fully settled.

17.2

Upon exit, the member's full savings balance is refunded, less any outstanding obligations, within the period prescribed by the Committee.

17.3

A member who exits and later wishes to rejoin must pay the Re-entrance Fee and complete a fresh Application for Membership.

17.4

Members whose employment with the Employer is terminated (for any reason) are required to settle all obligations within 60 days of termination.

17.5

The Committee may suspend or expel a member who persistently defaults on obligations, acts against the interests of the Society, or violates the By-Laws.

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18. Disciplinary & Dispute Resolution

ARTICLE 18

18.1

Any disputes between a member and the Society shall first be referred to the Management Committee for resolution.

18.2

If unresolved, disputes shall be referred to the Commissioner for Co-operative Development in accordance with the Co-operative Societies Act.

18.3

Matters not resolved through the above process may be referred to a court of competent jurisdiction in Kenya.

18.4

These Terms and Conditions are governed by the Laws of Kenya.

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19. Data & Confidentiality

ARTICLE 19

19.1

The Society collects and processes members' personal data for the purposes of administering membership, processing loans, disbursing benefits, and fulfilling statutory obligations.

19.2

Member data is held securely and confidentially. It will not be disclosed to third parties except where required by law, the Co-operative Act, or for the purposes of loan recovery.

19.3

By signing the Application for Membership, the member consents to the Society verifying any information provided with relevant third parties (e.g. employer, credit reference bureaus).

19.4

Benevolent Fund claims are handled with full confidentiality and are not disclosed to other members.

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20. General Provisions

ARTICLE 20

20.1

These Terms and Conditions are supplementary to and must be read together with the Society's By-Laws, the Co-operative Societies Act, Cap 490, and all Rules and Regulations made thereunder.

20.2

The Committee reserves the right to amend these Terms and Conditions at any time. Members will be notified of material changes at an AGM or through official written communication.

20.3

Continued membership after notice of any amendment constitutes the member's acceptance of the amended Terms.

20.4

If any provision of these Terms is found to be invalid or unenforceable, the remaining provisions shall continue in full force and effect.

20.5

The Society's financial year runs from 1st January to 31st December of each year. Audited accounts are presented at each AGM.

20.6

All official correspondence should be addressed to: The Secretary, Testimony Staff Savings and Credit Co-operative Society Limited, P.O. Box 2134 – 30100, Eldoret, Kenya. Tel: 053-2062714.

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Adoption & Official Signatures

EXECUTION

These Terms and Conditions were adopted by the Management Committee of Testimony Staff Savings and Credit Co-operative Society Limited on behalf of all members.

Chairman

Signature & Date

Secretary

Signature & Date

Treasurer

Signature & Date

Society Stamp: