The Crops (Coffee) (General) Regulations
38A. Society Loans
38A. Society Loans
The interest rate on borrowing against growers’ assets held in trust by the growers’ coffee co-operative societies such as assets, land, machinery, equipment, shall be capped at five per cent per annum.No society shall contract any loans or advances under subsection (a) except with the support of a resolution passed by a majority of the members to that effect.Any society that violates the provisions subsection (a) commits an offence and any loans borrowed in breach of this provision shall be statutorily converted.Nothing in this section shall be interpreted as prohibiting coffee farmers from directly borrowing money from regulated financial institutions or any government established funds against their deliveries of cherry, parchment and clean coffee.The trusteeship responsibility by the management committee of a coffee cooperative society is a Fiduciary duty of position of trust and directors shall have held liable for any directors. Waste and loss arising from negligence and breach of trust.[L.N. 102/2022, r. 19.]Source: Kenya Law