| 1. |
LOAN ELIGIBILITY
A member shall be eligible for a loan if he/she: -
| (a) |
Has had a continuous payroll deduction contribution
for a minimum period of three (3) months. |
| (b) |
Has a minimum of K200.00 in his/her general savings
account (S1 account). |
| (c) |
Is honest & of good character and has had no prior
conviction for fraud or theft |
| (d) |
Has good credit ratings |
|
| |
|
| 2. |
LOAN APPLICATION FORMS
| (a) |
All requests for loans shall be lodged in the form
of the Society’s loan agreement. |
| (b) |
The Society’s loan agreement must be completed
in full. |
| (c) |
A copy of the last 3 fortnights pay slips must be
attached. |
| (d) |
All necessary documents to support the application
must be attached. |
|
| |
|
| 3. |
PURPOSE, RATIOS AND TERMS
OF LOAN
The Society shall initially grant loans but not necessarily limited to the
following purposes -
| Code
|
Purpose
|
Ratio
|
Term
|
| 1. |
Education Expenses
|
1:2 |
3 years
|
| 2. |
Medical Expenses
|
1:2 |
3 years
|
| 3. |
Funeral Expenses
|
1:2 |
3 years |
| 4. |
Bride Price/ Wedding commitments
|
1:1 |
2 years |
| 5. |
Household Electrical items & chattels |
1:1 |
2 years
|
| 6. |
Holiday / Travel expenses
|
1:1 |
2 years
|
| 7. |
Motor Vehicle Purchase
|
1:1 |
2 years
|
| 8. |
Motor Vehicle Registration & Insurance |
1:1 |
2 years
|
| 9. |
Motor Vehicle Repair |
1:1 |
2 years
|
| 10. |
Outboard Motor & Dinghy Repair
|
1:1 |
2 years
|
| 11. |
Birthday Expenses |
1:1 |
2 years
|
| 12. |
Investments
|
1:1 |
2 years
|
|
| |
|
| 4. |
MAXIMUM LOAN
| (a) |
The maximum loan the Society may grant to a member
shall not exceed his / her total accumulated
savings at any one time taking into account
any existing loans, fees and charges that
is outstanding to the members account. The
maximum amount is limited to K20,000.00. |
|
| |
|
| 5. |
MINIMUM LOAN
The minimum loan that may be granted to a member at any one time shall be
K200.00. |
| |
|
| 6. |
MINIMUM SAVINGS CONTRIBUTION
The minimum savings contribution per fortnight for each member is K20.00.
|
| |
|
| 7. |
ADDITIONAL LOANS
Additional Loans May Be Granted to a member:-
| (a) |
Subject to Section 5, 6, 7 and 8 of this policy. |
| (b) |
If a members' current savings fully secures the aggregate
sum of the loan required, and any existing loan balance outstanding
on the ratio 1:1. |
| (c) |
No member shall be granted more than one (1) additional
loan per month. |
| (d) |
No additional loans will be granted to any member
whose existing loan balance exceeds their aggregate savings balance. |
|
| |
|
| 8. |
CHANGE OF LOAN PAYEE CHEQUE
| (a) |
Any loan cheques returned for the purpose of altering
the loan payee, shall be immediately cancelled, and the member's account
credited for the corresponding amount. |
| (b) |
The member may submit a fresh loan application. |
|
| |
|
| 9. |
FUNDING OF LOANS
| (a) |
All loan cheques for fully secured loans may be made
payable to members concerned. |
| (b) |
A fully secured loan means loans that are equal or
less than members savings balance. |
| (c) |
Loans may be funded on a progressive basis. New Loans
will be prioritized over additional loans. |
|
| |
|
| 10. |
LOAN REPAYMENTS
| (a) |
All loans are repayable within 24
months or less. |
| (b) |
All loan repayments and terms must strictly adhere
to the loan repayment schedule attached. |
| (c) |
Any interest rate in excess of 1% per month on the
unpaid balance may be charged subject to the approval of the Registrar. |
| (d) |
Not withstanding Subsection (c) and (d), a minimum
amount of interest of K2.00 per month may be charged. |
| (e) |
Interest may be calculated to the nearest whole month
during which a portion of the loan remains unpaid. |
| (f) |
Any interest charged on the loan under Subsection
(c) and (d), not repaid for six months after the last date of repayment,
cease to accumulate any additional interest in the member's loan account
but shall continue to be charged to the interest suspense account. |
| (g) |
A borrower may repay his loan in whole or in part
on any day on which the office of the society is open for business. |
| (h) |
Subject to Subsection (j), all monies due to a society
by a member, not being repaid for 18 months after the last date of
repayment, shall be provided as bad debt of the member. |
| (i) |
The society shall continue to recover from a member
moneys referred to in Subsection (i). |
| (j) |
Repayment schedule must include principal plus interest. |
|
| |
|
| 11. |
DEFERRED LOANS
| (a) |
Loan applications may be deferred pending the following
reasons: -
| (i) |
The member needs to increase contributions
to meet the terms of the loan. |
| (ii) |
The loan application is incomplete. |
| (iii) |
Three latest pay slips are not attached. |
| (iv) |
Quotations for the total amount applied for
are required. |
| (v) |
Documentary evidence from appropriate authority
is required. |
| (vi) |
An interview with the member is needed to gather
more information. |
|
| |
|
| (b) |
Deferred loan applications may be re-submitted for
a decision after fulfillment of conditions as outlined in Section
11(a) above. |
|
| |
|
| 12. |
LOAN
APPLICATIONS NOT APPROVED
Loan applications shall not be approved for the following or more reasons:
-
| (i) |
The member is terminated from employment. |
| (ii) |
The loan sought exceeds his savings balance. |
| (iii) |
The loan application is not consistent with this
policy. |
|
| |
|
| 13. |
LOANS TO MEMBERS ON LEAVE
| (a) |
Loans may be granted to members who are on leave
on the following conditions: -
| (i) |
The applicant shall pay in advance, the determined
loan repayments for the duration of leave in absence of payroll
deductions. |
| (ii) |
Failing the above, the loan application shall
be denied. |
|
|
| |
|
| 14. |
CASH DEPOSITS
| (a) |
Cash deposits shall be accepted as share saving contributions
or as a loan repayment. |
| (b) |
Loans requested immediately after making cash deposits
shall be considered on a share savings to loan balances ratio of 1:1
and subject to Section 7 (c). Exceptions are loans for school fees which can be
considered on a 1:2 basis. |
| (c) |
Additional loans requested immediately after making
cash deposits shall be considered on a 1:1 share savings to loan balance
ratio one month from the date of the last deposit. |
|
| |
|
| 15. |
LENDING PRIORITIES
| (a) |
The privilege to obtain loans shall be in this order
of priority: -
| (i) |
Loan applications for amounts to be considered
on a share savings to loan balances ratio 1:1 - except if applying for
a school fee loan. |
| (ii) |
Time of submission. This means loan applications
shall be considered on a first come first serve basis. |
|
|
| |
|
| 16. |
SECURITY
| (a) |
Additional security shall be taken out on any particular
loan deemed necessary and/or directed in accordance with the Rules
of the Society. |
| (b) |
The Society shall have a lien on all categories of
member's savings, against loans that he/she may hold at any one time. |
|
| |
|
| 17. |
INTEREST ON LOANS
| (a) |
(a) The Society shall charge interest of 1% per calendar
month on the unpaid balance on all existing and current loan accounts. |
|
| |
|
| 18. |
LOAN INTEREST REBATE
| (a) |
A member that pays out their loan prior to the completion
of the term of loan shall earn an interest rebate. |
| (b) |
The rebate shall be in the form of any further loan
interest that may be due on the loan for the full term of the loan,
calculated from the date of loan payout. |
|
| |
|
| 19. |
STAMP DUTY
| (a) |
A Stamp Duty of K10.00 shall be charged on loan agreement
for amounts ranging from K4, 000.00 to the maximum of K10, 000.00.
Stamp Duty shall be charged at 0.1 % of the loan amount for any loan
funded over K10, 000.00. |
| (b) |
The fee is compulsory charged by the Internal Revenue
Commission. |
|
| |
|
| 20. |
MEMBERSHIP WITHDRAWAL
| (a) |
Member will not be allowed to withdraw until they
have paid their loan in full. |
| (b) |
Withdrawing members will receive the balance of their
savings and less outstanding loans. For deceased members, entitlements
due will be paid to their next of kin or to the Public Curator's office. |
| (c) |
All requests for membership withdrawal shall be in
written form. |
|
| 21. |
SAVINGS TO OFF-SET LOANS
| (a) |
Savings may be transferred to offset loan accounts. |
|
| |
|
| 22. |
DELINQUENCIES
| (a) |
All loans delinquent for more than thirty (30) days
shall be served 1st reminder notices. |
| (b) |
All loans delinquent for more than Sixty (60) days
shall be served 2nd reminder notices. |
| (c) |
All loans delinquent for more than Ninety (90) days
shall fall immediately due. A letter of demand will be issued to settle
the account in full forthwith. |
| (d) |
After 7 days, legal proceedings to recover bad loans
shall be immediately instituted against those borrowers who fail to
respond to the letter of demand. |
|
| 
