July 30, 2012   by

While some investment groups turn out to be successful, others either break up or achieve nothing. This can be because of proper planning, lack of a clear vision on the founders part, or wrangles arising from the groups investment direction. A Chama gone wrong will leave you with financial losses and ruin your friendships.

Do you want to build a successful investment group? Here are things you ought to know.


Before you join or form a Chama, make sure that you are in-sync with the other members.

Do you all want to save money and make investments ? You should all have common goals and a shared interest. The success of investment groups is not just in money. Make an effort to know each either by organizing  team building or bonding sessions. You will find that the skills, talents and connections of each member can be exploited to boost your Chama’s fortunes. You should also agree on how much every member is to contribute and how often. This can be weekly or monthly. You should agree on what you want to do with the money in the meantime. Do you want to save in a bank account or do you want to lend to members at an interest?


You need to appoint a management committee. This will be made up of the secretary, treasurer, chairman, vice-chairman, investment manager, operations manager etc. This is the team that will ensure everyone has contributed the designated money. They will also present investment opportunities to the team, sign cheque’s on behalf of the group, open a bank account etc. They will basically be involved with the day to day running of the group.

The Rules

You should draw some rules and regulations that all members ought to adhere to. For example, do you want to penalize people who delay to make contributions? How can a member quit if they want to ? How much power does the Chairman have ? As an individual this protects you from the risk of being exploited. Ensure you have laws that protect the groups money from being stolen by a few individuals.

Seek advice

One of the reasons some Chama’s fail is because they cannot agree on what to invest in. One person may propose that the group buys land while another may propose that they lease land and grow maize instead. Every member comes with their own idea of ‘where money is’. This brings wrangles. You can seek advice from an Investment Advisor or other successful Chama’s on what investments are lucrative.



There are also organizations like the Kenya Association of Investment Groups  which can connect you with other groups and help you maximise on your investment potential. KAIG also provides training and education on the current avenues of investment available to investment groups.


For an investment group to succeed and maximize its investment potential, all members need to be committed to its goals. You should also be aware that sometimes investments will not go as expected. Some investments are long-term and it could take years before individuals begin to reap from the investment. All members should be committed and understand what goals the group seeks to achieve.

It is important to address these issues from the onset. And remember to have fun as an investment group!

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This post was written by Chamasoft

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    charles mathenge
    on August 15, 2012, 12:47 PM

    Hi. Thanks for meking me understand the importance of chamas. I live in mombasa and would like to knw which chama are good to invest in? Thank you.

    Martin Njuguna
    on August 15, 2012, 1:42 PM

    Charles, Thanks for the comment. I may not be in a position to tell you which chama you can invest in but we will see what to do about this



    Vivian Andera
    on August 31, 2012, 8:32 AM

    Thank you Martin for the advise. Our Chama has managed to buy 5acre plot in Nanyuki and currently we have 1M in liquid cash and planning to look for land in isiinya. Pls advise..on the options we have in investing the 1M and how to now invest in income generating assets. Thank you.

    on October 28, 2012, 6:25 PM

    Very insightful information. God bless

    Daniel Muturi
    on November 11, 2012, 10:51 AM

    Hello which bank is currently giving the best interest rate on money deposited by a Chama group

    Wincaster Mutisya
    on November 16, 2012, 6:13 PM

    thanx for the information. kindly assist me with a sample of chama constitution.

    on April 19, 2013, 12:04 PM

    Thanks for good work.

    Iam in a chama and i would like to make it more active than it’s oftoday. Kindly break down a few guidelines as i have seen you are pro on this field.1. How do we achieve and how do meets our targets kindly this can be helpful to many.


    erick mutembei
    on July 22, 2013, 7:29 PM

    This article is great. be blessed

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