[Interview] Government Should Scrutinize Activities Of Cooperative Societies- Silas Ifeanyi, MD Fundtrust Savings And Loans

Government Should Scrutinize Activities Of Cooperative Societies- Silas Ifeanyi, MD Fundtrust Savings And Loans

Government Should Scrutinize Activities Of Cooperative Societies- Silas Ifeanyi, MD Fundtrust Savings And Loans

From Aloysius Attah, Onitsha

Mr Silas Ifeanyi is the Chief Executive Officer, Managing Director, Fundtrust Savings and Loans Multico-operative Society Limited, Onitsha.  The company which provides financial services to market women, lower income traders in Anambra State recently celebrated three years of its corporate existence. To Mr. Ifeanyi,, there is an urgent need for proper scrutiny of the activities of those running such services by government so that abuses can be checkmated. He also believes that they have provided the missing link for those who cannot transact business directly to banks because of their low level of income.

The journey so far

Three years ago when we started this corporate thrift business, nobody knew us at all. It was like we were number last but today, I’m not sure you can count two or three without counting us. In 3 years, we have moved from one branch to ten branches. We decided to do something that will serve people at the lower level of market, the unbankable people.  We deal with those  banks don’t even talk to because they save their N100, N200, N300 per day, you know there is no way they can take those little things to the bank on daily basis. So we decided to serve them by providing a platform where they can bring up their savings. They became members of our co-operative and contribute on daily basis.  One unique thing about our kind of service is that those savers can take their money anytime. It’s not tied to any specific period before you can access your money.

Among them, we give them co-operative loans depending on their capacity and this is the kind of service they can’t get from anywhere. If they go to banks, they will ask them for collateral which they don’t have. Our clients are the market women, the poor people managing to make ends meet.  We have with a vision to provide grassroots financial services to the unbankable people. We collect their small naira daily savings and give them loans.

Another service we render is property acquisition. So many of them need something like flat screen television, deep freezers, GP tanks etc which they cannot afford to buy at a go so they need the small, small savings. And to create that discipline is difficult to save in their houses so we have property savings for them where they start contributing towards the purchase of what they need. When they finish contributing, we deliver to them, this year alone; we have about 5000 people who registered for our property savings scheme.

Out of this, we have delivered up to 85 percent. We have our delivery van and the property manager is very busy now in meeting up with the demands. The focus is still to serve the underserved.  Many times we hear about the money that are out of the system and they quote all kinds of figures because nobody will tell the exact amount of money that is out of circulation but what we do is to go to all the local markets and mop up such monies and bring them to the official level by taking them to the banks on their behalf.

We provide services that no bank can provide because we go to the customer to take the small money deposit it in the bank and also take the money back to the customer on request thereby making the customer the king.  If it was the banking system, the person has to go to the bank, go and queue up to pay and also queue up to cash the money but in our case, we go to their shop, collect it from them in bits and even return to the same shop many times in a day and then when they need the money, we take it back to them. We are very informal in the way we treat the customer unlike the real banking system where everything has to be formal.

Gaining confidence of our customers

Before we ventured into this business we first of all commissioned a study to find out why people fail in business. We found out that there is high rate of attrition in this business. Some can just without warning close shop one day with people’s life savings going down the drain. The first thing we noticed was that so many people come into this kind of business without capital , they just wander into it and when they collect money from customers, that becomes their capital .Because this people just buy handbag and umbrella and begin to collect people’s money , eventually, the person pays bills from people’s money, hospital bills, house rent , feeding etc  and because they call it income not remembering that it is a liability which means that they are going to pay people back .

For any new company, there is need to put up a down capital from which expenditure can be incurred. The capital is provided by the owners and from there you spend all the initial bills because it takes time to mature into profit. If one comes into the business without a seed capital, assuming you receive N100 million from customers, spend N20 million, there is a balance of N80 million to pay so the owners of the other N20 million already spent will not get their pay and that signals the close of that business.

So capital is of great essence coupled with the training and skills. To succeed in this, one need to know the difference between assets and liabilities, short term and long term inclusive. What some people do is that they get this money from customers, lend it out in long term forgetting that this is a short term transaction they need to pay on demand while they lend it to traders who may have gone to import goods that may take some months to clear. With that situation, they create a mismatch between assets and liabilities , the assets they have in terms of loans don’t match the liabilities because they are lending long term  while the customers’ deposits they have is short  term in maturity so they don’t match. When the owners of the money request for it, they begin to scratch their head because they can’t pay since somebody has borrowed it earlier.  Without skills they can’t train people working for them because you can’t give what you don’t have.  This is one of the things we know because we have the experience. I rose to the rank of a general manager in a bank and I made history in various fields.  I went to the best management schools in the world and all the time my focus while learning has been on business strategy. I ask myself all the time, what do I do to succeed?

What they do to cover the gain is that some people are fraudulent in character.  Their initial intention is not to serve anybody. For example, we have some staff who were in a hurry to be on their own. They just pulled out to do something only to run into trouble and dupe some people six to seven months into the business. Some also come into the business with a mindset to steal from the onset. Can you imagine that some people entice people with promises of loan like they tell you they give N1million and tell you to make down payment of 30percent which is N300,000, once they collect the down payment, stories will set in and that will be the end of the loan collection.

Ways out of trouble

People need education. Government also needs to regulate these services. Some people can be just gullible to put their money into unsecure firms just because they saw somebody approach them with cards and materials for thrift business. Government register co-operatives but there are minimal supervision. There is need to regulate the market so that it will not be free for all. Like if one is to establish a micro finance bank, there is a minimum amount you deposit just like in Bureau de Change business because these ones are regulated by Central Bank unlike this one regulated by the state government. I know some of the operators of this cooperative business are not even registered. It is even some local market authorities that have put up some regulations to checkmate abuses in some markets but they are not doing enough.

Motivation is the key to make your staff smile

In this place we have our core values which one of them is empowerment. The staffs are empowered to make high powered decisions without climbing the ladder of bureaucratic bottlenecks. We also have what we call the ownership culture; we let everybody who works for us see him/herself as an owner. If you don’t see yourself as an owner here, it won’t work. If you get in here and you see a cobweb hanging on the wall and you don’t find something to remove it, you are not adding any value. It’s just like seeing somebody stealing here and decides to keep silent. That is not ownership and we don’t hesitate to deal with the situation. We motivate our staff in various ways and also pay them well. In some places, they operate on target but here we operate on goals.  Instead of giving our staff target which puts them into desperate pressure we set goals and work towards achieving them.


Our major challenge is securing trust.  How do I make a customer to trust me when many other have failed him? When a misguided fellow among us commits fraud, some people judge us by that .Also, the risks we bear is a challenge also.



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