Govt Moves to Rescue SACCO Members Following Massive Losses

Millions of Kenyans who rely on Savings and Credit Cooperative Organisations (SACCOs) are finally seeing signs of relief after a series of shocking losses rocked the sector.

Just last year, members of KUSCCO lost Ksh 13 billion, while Metropolitan SACCOs saw Ksh 7 billion vanish, leaving ordinary savers worried about the safety of their hard-earned money.

On Monday,  at the 10th KUSCCO Annual Leaders’ Summit held at Sarova Whitesands Hotel in Mombasa, Cabinet Secretary for Cooperatives and MSME Development, Wycliffe Oparanya, laid out a sweeping plan to restore stability and protect depositors.

“We must ensure legislation protects members’ savings,” Oparanya said, stressing that proposed amendments to the Sacco Societies Act will bring transparency, digital integration, and accountability across the industry.

Kenya currently ranks eighth globally and first in Africa for cooperative financial systems, but Oparanya warned that leadership comes with responsibility.

The government’s reforms aim to prevent further governance failures and restore public confidence. Among the measures, SASRA, the Sacco regulatory body, will receive expanded powers to monitor operations closely.

New safety nets, including a Deposit Protection Fund and a Savings Stabilisation Fund, will be set up to protect members from losses, while a Central Liquidity Facility will offer emergency cash support to struggling SACCOs.

The CS also announced mandatory professional registration for SACCO board members and executives. “Those who create governance failures in one SACCO will not be allowed to shift to another. Integrity is non-negotiable,” he stated firmly.

A committee of experts, appointed last year and supported by the African Confederation of Cooperative Savings and Credit Associations (ACOSCA), has reviewed the 2008 Sacco Societies Act. Their recommendations, expected to be presented to the President, will roll out in a five-year phased plan.

“We are confident that if the recommendations are fully implemented, Kenya will achieve a new global benchmark in the Sacco industry,” Oparanya added.

KUSCCO National Chairman David Mategwa also reassured members that recovery efforts are underway.

“We came in with a transformation agenda. Recoveries are ongoing, auctions have begun, and funds are being returned,” Mategwa said.

He called on SACCOs to stay committed to subscriptions and governance training, emphasizing that digital accountability is now the rule.

“Any money coming out of KUSCCO must go through proper digital processes, leaving a record so it can be tracked. That is the accountability we stand for,” he said.