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A SACCO, which stands for Savings and Credit Cooperative Organization, is a member-based financial institution where people pool their savings and use them to provide loans to each other. These organizations are not-for-profit and are owned and managed by their members. Key Characteristics of SACCOs: Member-owned and controlled: SACCOs are democratically governed by their members, who elect a board of directors to oversee operations. Not-for-profit: Unlike banks, SACCOs are not primarily focused on making profits for shareholders. Mutual benefit: Benefits are returned to members in the form of lower loan rates and higher deposit rates. Saving and credit: Members save money through their SACCO, and these funds are used to provide loans to other members. Regulation: In many countries, including Kenya, SACCOs are regulated by a regulatory authority to ensure their financial stability and protect members' interests. How SACCOs Work: 1. Membership: Individuals join a SACCO by purchasing shares, which grants them membership rights and access to services. 2. Savings: Members contribute their savings to the SACCO, which forms the core capital. 3. Loans: The SACCO provides loans to members, using the accumulated savings as the loan fund. 4. Repayment: Members repay their loans, along with interest, which contributes to the SACCO's overall financial health. Benefits of SACCOs: Access to finance: SACCOs can provide access to credit for individuals who may not be eligible for loans from traditional financial institutions. Savings culture: SACCOs encourage saving and can help members build financial stability. Community development: SACCOs can play a role in local economic development by supporting businesses and entrepreneurs.