TECHNOLOGY are encouraged to make data analytics central to their growth plans because the traditional selling points are slowly being eroded by emerging competitors. Knowledge is power, and data provides that knowledge; hence the need for Co-operatives to leverage data as a competitive advantage. To compete effectively, Saccos need to use data to understand their customers on a personal level so that they can develop digital products that meet their needs.
Hon. Peter Munya, CS, Trade, Industry & Co-operatives.
Fraud Mitigation: Saccos to Deploy Data Analytics By June Njoroge
T
he digital wave that has swept across the Cooperative movement to address members’ needs more efficiently and conveniently, has exposed the gaping vulnerability in the sector, as the cases of fraud and money laundering have become ever so rampant. In light of this, Deposit Taking Savings and Credit Co-operative Societies (SACCOS) have been advised by the State Department of Co-operatives to adopt a strong anti-fraud stance in order to protect member funds. The Sacco Societies Fraud Investigation Unit (SSFIU) is already operational, initiated to curb the cases of fraud and corruption in Co-operatives, by the Sacco Societies Regulatory
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SACCO TIMES | DECEMBER 2020 - JANUARY 2021
Authority (SASRA), Directorate of Criminal Investigations (DCI) and the Ethics and Anti-Corruption Commission (EACC). This was followed by a Presidential directive in July for the unit to be set up. The Co-operatives Cabinet Secretary Peter Munya, has been spearheading the initiative to curb fraudulent dealings in Kenya’s Co-operative sector. Among the measures adopted by Co-operatives to mitigate fraud is forensic data analytics which aids in fraud detection and prevention. Its basically a combination of technology and analytical techniques with human interaction; to help in detecting instances of fraud, corruption, abuse and other forms of noncompliance either before or after a transaction. Saccos
If Saccos continue to maintain data in traditional data warehouses, they cannot be able to solve emerging problems, because the structured data model, lacks flexibility to adapt new business challenges. Co-operatives need to make informed decisions to help meet the emerging needs of their membership. Data analytics can also help identify hidden opportunities, accelerate member engagement, prioritize offers, influence digital adoption and identify at-risk members. In a global survey, 40,000 certified fraud examiners revealed that proactive data monitoring and analysis is an invaluable addition to an organization to limit potential financial and reputational losses from fraud. Data analysis uncovers hidden patterns and insights which enhances understanding of customers and the products they need. Some Saccos utilize data lakes, which are vast pools of raw unstructured data, which complements a data warehouse. This allows the Sacco to use their data to identify and solve any business problem, because they are flexible and extendable. Data analytics enhances the ability to identify trends, forecast outcomes
