Members of the Kenya National Police DT Sacco have withdrawn unknown amounts from their accounts beyond their available balances following a system glitch.
The system issue, which has since been resolved, occurred on Thursday evening, resulting in 1,227 members overdrawing from their transaction accounts using the digital banking platform called M-Tawi.
Sacco has reached out to members who have overdrawn their accounts to return the funds.
“Dear (name withheld), yesterday evening M-Tawi experienced a technical challenge that affected the system’s checking of balances before withdrawals. As a result, a total of 1,227 members withdrew their Fosa accounts and thus the Board of Directors requested a refund without fail to avoid any necessary action that may deemed appropriate,” Sacco said in a Friday morning message to its members.
Saccos Front Office Service Activity Accounts, abbreviated as Fosa Accounts, are transaction accounts that provide banking services such as those provided by commercial banks. The account is used to receive dividends and rebates as well as to receive salaries.
Kenyan Police Chief Sako David Mategwa said in a telephone interview with The daily business, The problem arose while Sacco was performing a system update. He did not mention the amount of overdrawn funds, even as he refuted the hacking allegations.
He explained that deposits and capital were not affected. Members who will not return withdrawn funds will see a portion of their deposits used to recover the amount, Mr Mategua said.
“The hitch allowed members to withdraw money beyond what was in their Fosa accounts. We informed them all and many of them returned the money. For those who won’t, we will figure out how to recover,” Mategua said.
“We have narrowed our scope to those who have exceeded the limit, so there is no reason to worry. For those who will not, we can tap into their savings to cover this amount.
Members can access withdrawable SACO deposits at any time, through channels such as cashier withdrawal transactions, mobile money withdrawals, ATM platforms or the Internet, depending on the capabilities of each SACO.
Members are permitted to withdraw part or all of these deposits at any time and of their own volition, without losing membership.
Kenya Police Sacco is one of the largest companies in the country and had withdrawable deposits worth Sh3.2 billion at the end of December 2023, while non-withdrawable deposits stood at Sh28.5 billion.
Sacco paid a 17 percent dividend on capital, amounting to Sh599.04 million while interest on deposits was 11 percent, totaling Sh2.98 billion in the financial year ending December 2023.
The Kenya Sacco Associations Regulatory Authority ranked Police Sacco as the third largest company in the country by asset base as of the end of 2022 when Mwalimu National Sacco and Stima Sacco ranked first and second respectively.
