The government plans to establish a new regulatory authority to safeguard billions of shillings in non-Sacco cooperatives, addressing a critical oversight that has left thousands of Kenyans, especially farmers, vulnerable to financial loss.
Cabinet Secretary for Cooperatives and MSME Development, Wycliffe Oparanya, said the new regulator will operate within his Ministry to enforce accountability and transparency across all cooperative models.
The CS revealed that while the Sacco Societies Regulatory Authority (Sasra) has successfully stabilised deposit-taking Saccos, other cooperatives remain under-regulated and prone to mismanagement.
“Because we have also learnt that members in the coffee, cotton, and other agricultural sectors also lose a lot of money. The government has a regulatory authority, the Sacco Societies Regulatory Authority (Sasra), to oversee the saccos. Unfortunately, the other cooperatives apart from the saccos are overseen by the Commissioner of Cooperatives,” said Mr Oparanya.
Non-Sacco cooperatives in Kenya are member-owned outfits that focus on specific economic activities such as agriculture and housing, and do not engage in savings and credit. They fall under the Commissioner for Cooperative Development, unlike Saccos which are regulated by Sasra.
The CS decried mismanagement of saccos which he says has left a lot of financial institutions struggling.
Cooperatives and Micro, Small and Medium Enterprises Cabinet Secretary Wycliffe Oparanya.
Photo credit: Fiie| Nation Media Group
He also accused some sacco officials of mismanagement by travelling to Europe, Singapore and Malawi for benchmarking, yet Kenya is regarded as the best in Africa.
“People save all their lives, retire but can’t access their money due to mismanagement."
Speaking at the 11th Sacco Leaders Convention in Mombasa, CS Oparanya noted that while cooperatives are private entities, the state must protect members who are excluded from boardrooms and management.
“Sasra is currently overwhelmed by the sheer number of cooperatives. We are rethinking our strategy to constitute a new regulatory body similar to Sasra to ensure proper oversight of other cooperatives,” the CS stated.
