Over 315 members of Kagace Muguka Farmer’s Cooperative Society were for the first time issued with a dividend on shares at 5.2 percent Tuesday.
The cooperative which is in Mbeere South Sub-County Embu County draws membership from Kanothi and Gacegethiori villages. They were issued the dividend at that rate for every 10 shares of Sh100 each.
David Muriuki who is the founder and patron of the society said the management resolved to issue the dividend based on Sacco’s income in the last financial year in its audited accounts.
“This is the first time a muguka cooperative has issued a dividend and hopefully it has trail blazed for others. Muguka farming and trading is booming so we expect its peers to follow suit,” noted Muriuki.
Muriuki said the Cooperative was formed in 2017 by 36 members, most of them parents of Kanothi Primary School of which he was the chairperson of the board and the then Embu Commissioner for Cooperatives.
He was concerned that the parents defaulted in paying school fees despite having income from muguka (khat).
This prompted him to bring them together and they started contributing Sh300 weekly and would later qualify for loans to pay their school fees.
The patron said for one to be a member, they have to pay Sh1,000 registration fee as share capital and to qualify for a loan, a member must have savings of at least Sh5,000.
“The initiative has grown into a stable cooperative that offers development loans, school fees loans and emergency loans. Membership has expanded to include other sectors such as salaried people,” said Muriuki.
Muriuki further revealed that among investments that Kagace Cooperative has is Sh1.5 million savings in a Money Market Fund in CIC Insurance and a prime plot in Kiritiri town where the cooperative is in the process of putting up its headquarters.
He added that the cooperative intends to acquire a loan from the Miraa Fund and use it to finance the construction of the headquarters, assist members acquire water tanks, and partner with suppliers for supply of muguka farming inputs.
The patron added that the Miraa Fund, an initiative of the national government, disburses loans at a rate of 3 percent per year.
On the prospect and future of muguka as a cash crop, Muriuki said that about Sh9 billion is generated annually by the crop in the county as compared to Sh1 billion from coffee.
On channeling the money earned through muguka to the right use, Muriuki said the cooperative is helping the youths in embracing a saving culture rather than spending the hard earned money on alcohol and drugs.
Kagace Cooperative is among the 22 village cooperative societies which form the umbrella Mbeere Embu Miraa Farmers Union with membership ranging from muguka farmers, traders, drivers and transporters.
By Kimani Tirus