How to Build a SACCO Collateral Register That Will Survive a SASRA Examination

When SASRA examiners visit your SACCO, one of the core documentation areas they review is your land collateral register. This is not a surprise inspection category. Regulation 43 requirements are published. What you will find in your portfolio is predictable, because the requirements are clear.

Yet many SACCOs receive examination findings in this area because their collateral documentation has not kept pace with their portfolio.

Here is what a compliant collateral register looks like and how to build one.

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What SASRA Is Looking For

SASRA examiners reviewing land collateral documentation typically check:

1. Is there an independent registered valuer's report for every land-secured loan?

Regulation 43 requires an independent registered valuer's report for every piece of land used as collateral. "Independent" means the valuer is not employed by the SACCO, not a family member of the borrower, and has no material interest in the transaction.

"Registered valuer" means a valuer registered under the Valuers Act, Cap 532. This registration can be confirmed through the Institution of Surveyors of Kenya (ISK) register.

2. Is each valuation current (within three years)?

Regulation 43's three-year revaluation requirement is explicit. If a valuation was done in 2020 and has not been refreshed, it is out of compliance. For loans that are still active, the collateral should have been revalued.

3. Is the charge properly registered?

The charge must be registered at the Land Registry. A SACCO that accepted land as security and signed a charge document but never registered it has incomplete security: the charge is not effective against third parties until it is registered.

4. Is the insurance current?

Regulation 43 also requires that collateral "be adequately insured." Fire insurance, structure insurance, or other relevant cover for the property should be in place and current. Insurance renewal lapses are a common finding.

5. Is the LTV ratio within acceptable limits?

SASRA reviews the loan-to-value ratio: the outstanding loan balance divided by the current collateral value. A ratio above 100% means the collateral no longer covers the loan. Given that valuations may be stale and properties may have declined in value, some loans may have LTV ratios the SACCO is not aware of.

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What a Compliant Collateral File Contains

For each loan secured by land collateral, the individual loan file should contain:

A copy of the title deed (certified copy, not the original — retain the original in secure custody).

A copy of the official search result at or around the time of lending.

The independent registered valuer's report (with the valuer's registration number).

Any revaluation reports (with dates confirming the three-year cycle is being met).

The charge instrument (the legal document creating the security interest).

The official confirmation of charge registration at the Land Registry (typically the search result showing the charge entry, or a confirmation letter from the registry).

Insurance certificates showing current cover.

For agricultural land: the Land Control Board consent for the charge.

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The Collateral Register Structure

Beyond individual loan files, a SACCO should maintain a central collateral register: a consolidated view of all land-secured loans. The register should show for each loan:

Loan account number and member name.

LR or CR number of the collateral parcel.

County.

Date of initial valuation and valuer's name.

Initial valuation amount.

Date of most recent revaluation.

Most recent valuation amount.

Outstanding loan balance.

Current LTV ratio.

Charge registration date and status.

Insurance status and renewal date.

Date of last CVP (Collateral Verification Pack) or external verification check.

A properly maintained register allows the credit committee to see the full collateral picture at a glance and to identify portfolios that need attention: loans approaching LTV limits, collateral positions with stale valuations, charges not yet registered.

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The Litmus CVP Integration

For each new land-secured loan, integrating a Litmus Collateral Verification Pack into the origination process provides several register benefits:

The CVP documents the chain of title at the time of lending (relevant for the post-Sehmi root-of-title requirement).

The CVP confirms no competing charges or adverse entries at origination.

The CVP's named verifier attestation provides court-ready evidence of the title state at the time the charge was registered.

The CVP is dated and can serve as the independent check in the three-year revaluation cycle alongside the updated registered valuer's report.

Institutional pricing: KSh 3,000 per parcel. 90-day proof package (10 parcels): KSh 30,000. Below most SACCO procurement committee thresholds.

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What to Do If Your Register Has Gaps

Start with an audit: review your collateral portfolio and flag every file that has missing components.

Prioritise by risk: focus first on the highest-value, highest-LTV, and most distressed loans.

Obtain missing documents: for missing valuation reports, commission fresh independent valuations. For missing charge registrations, engage an advocate to complete the registration. For missing insurance certificates, contact the borrower to renew.

Update the register: once each file is complete, update the central register to reflect the current state.

Report to the credit committee: a collateral audit finding is material information for credit committee oversight.

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This article is for general information only. It does not constitute legal advice. For SASRA examination preparation, consult a Kenya advocate with SACCO regulatory experience.