Generally, no, you cannot directly withdraw your share capital from a SACCO.
Your share capital in a SACCO is fundamentally different from your regular savings or deposits. It represents your ownership stake, or equity, in the cooperative and is therefore treated differently from liquid funds.
Understanding Share Capital vs. Member Deposits
To clarify, it's important to distinguish between the two primary types of contributions members make to a SACCO:
- Share Capital: This is the portion of equity that a member owns in the SACCO. It signifies your part-ownership and commitment to the cooperative. Importantly, this amount is not withdrawable.
- Member Deposits: These are your regular savings that accumulate over time. They are often used as a basis for determining your eligibility and capacity to secure loans from the SACCO. While specific policies vary by SACCO, member deposits generally function as more liquid savings compared to share capital.
The distinction is crucial because the non-withdrawable nature specifically applies to your share capital.
| Feature | Share Capital | Member Deposits |
|---|---|---|
| Nature | Equity/Ownership Stake | Personal Savings |
| Withdrawable? | No (not directly) | Generally more liquid (policy varies by SACCO) |
| Purpose | Permanent capital base for the SACCO's operations | Eligibility for loans, personal financial growth |
| Transferable? | Yes, to another member upon termination of membership | Generally withdrawable or transferable as savings |
What Happens to Share Capital Upon Membership Termination?
Since share capital is not directly withdrawable, if you choose to terminate your membership with the SACCO, your shares are managed through a specific transfer process.
- Transfer to Another Member: Your share capital is transferable to another member – either an existing one or a new member joining the SACCO. This mechanism allows you to divest your ownership stake while ensuring the SACCO's capital remains intact for its operations and the benefit of other members. The exact process and timelines for such transfers will depend on the specific SACCO's by-laws and policies.
This system ensures the financial stability and continuity of the cooperative, allowing it to fulfill its core mandate of providing financial services to its members.
For more detailed information regarding specific policies on shares and deposits, it is always recommended to consult the official FAQs or by-laws of your specific SACCO, such as those often found on cooperative organization websites.
