Rumukia Farmers Cooperative Society has escaped the auctioneer's hammer after it signed an agreement with Taifa Sacco Society to have their overdue loan restructured.
Taifa Sacco restructured the loan repayment to six years and waived the accrued interest of about Sh21 million.
Rumukia, which has eight coffee factories from Mukurwe-ini subcounty, owed Taifa Sh163 million in loan and interest accrued since 2015.
But the farmers will now pay Sh142 in six years after the loan restructuring and interest waiver.
The two parties signed the agreement on Friday in Nyeri Governor Mutahi Kahiga’s office following negotiations facilitated by the county chief.
“This was after I intervened and facilitated negotiation between the two parties after Rumukia FCS was given an auction notice due to the outstanding debt that started in the year 2015 and has been accumulating over the years,” the governor said.
The county had held several meetings with the two cooperatives before an agreement was reached and signed by the representatives of the two societies led by their chairmen, Paul Chiera of Rumukia FCS and James Giting’a of Taifa Sacco.
“This will help bestow confidence to Rumukia FCS members and ensure that the two societies will continue to work together as they have done over the years for the benefit of their members,” said Kahiga.
The governor pledged to offer extension services to ensure farmers increase production and governance in Rumukia enhanced to enable it to repay the loan with ease.
Rumukia FCS has a membership of over 8,500 farmers and produces an average of 4 million kilograms of cherry per year.
“Rumukia is in a very delicate situation as they have to balance and ensure farmers are paid at the best rate possible and at the same time service the loan,” Kahiga said.
Two weeks ago, panic gripped members of Rumukia FCS, after reports emerged that the society’s property would be auctioned to pay the loan.
Giting’a expressed hope that Rumukia FCS will now be able to repay the loan following the intervention and maintain the good working relationship between the two.
Chiera on his part thanked the county government for its intervention saying farmers were worried after reports leaked that their property would be auctioned.
“We approached the governor and explained the situation to him and he facilitated the discussions between Taifa Sacco and Rumukia FCS. We are all farmers and partners in the business and we have to work together,” he said.
He called on farmers to improve their production so that the society can meet the target of paying the initial payment of Sh20 million.
Mukurwe-ini West MCA Atanasio Kabaire said he was happy that farmers did not lose their property.
Kabaire blamed the problems the society has found itself into to coffee hawking by farmers following poor prices.
He said coffee hawking should be discouraged and farmers made to deliver their coffee in societies to save them from collapsing.
