What can happen if you default?

  1. Penalties and additional interest: Late-payment charges may apply according to the loan agreement.

  2. Recovery from your deposits: The SACCO may offset eligible deposits against outstanding arrears, subject to its agreement and applicable rules.
    SACCO SOCIETIES REGULATORY AUTHORITY (SASRA)
  3. Guarantors may be affected: If you used guarantors, they may be called upon to meet the guaranteed amount in accordance with their undertakings.

  4. Credit reference consequences: Your default may be reported to a Credit Reference Bureau where legally permitted and applicable procedures are followed.

  5. Legal recovery: The SACCO may pursue the outstanding debt through lawful recovery procedures.

What should you do if you cannot repay?

  • Contact the SACCO’s credit office as early as possible.

  • Explain your financial situation and ask whether rescheduling or restructuring is available.

  • Do not ignore repayment notices.

  • Request an updated loan statement showing the outstanding balance, interest and penalties.

For Soma SACCO members: The exact penalties, recovery process and options available depend on the SACCO’s approved loan policy and the terms of your loan agreement.