The government has expressed serious concern over the rising mismanagement within Saccos, which has resulted in significant losses of savings and investments by members.
Cabinet Secretary for Cooperatives Wycliffe Oparanya stated that despite efforts to review and update the legal and regulatory framework governing Sacco leadership and management, mismanagement and corruption continue to persist among some officials.
Oparanya called for support for the establishment of a federation to oversee Saccos, as outlined in the Cooperative Bill 2024 currently before Parliament. “Addressing mismanagement cannot be the sole responsibility of the government. It requires cooperation and partnership with Sacco members and industry leaders to effectively implement the policy and legal framework.
I expect the federation to act as a guardian of good governance, given its legal and moral authority due to the significant public interest involved,” said Oparanya.
He added, “The Sacco industry, through the federation, must embrace, advocate, and uphold good governance practices through public education and self-regulation.”
Speaking at the launch of the SACCO Societies Regulatory Authority (SASRA) Supervision Report, Oparanya highlighted a troubling disparity within the sector. Out of 357 registered Saccos in Kenya, 73.3% of the industry’s total assets are concentrated in just 53 Saccos. In contrast, the remaining 304 Saccos, primarily comprising smaller, community-based groups, collectively hold only 36.6% of the assets.
“This is unusual in the financial sector and raises significant policy concerns about the impact of small Saccos, which are often established by communities of like-minded individuals,” Oparanya noted.
