Tuesday eleventh March, 2025 03:20 PM|
The cupboard has authorised amendments to the Sacco Societies Act, 2008, following a wave of losses in latest occasions.
In a despatch after a cupboard assembly on Tuesday, March 11, 2025, the cupboard mentioned the modifications intention to modernise monetary and technological operations, significantly benefiting smaller saccoss.
“In a bid to enhance the stability, efficiency, and competitiveness of Kenya’s Savings and Credit Cooperatives (saccoss), the Cabinet has approved amendments to the Sacco Societies Act, 2008. The proposed reforms, outlined in the Sacco Societies (Amendment) Bill, 2023—now before Parliament—aim to modernise financial and technological operations, particularly benefiting smaller saccos,” the despatch learn partly.
Key reforms embrace a sacco Shared Services Framework, permitting the monetary establishments to pool sources, undertake fintech options, and improve cooperation, whereas sustaining operational independence.
The cupboard has additionally proposed a Central Liquidity Facility that can facilitate inter-sacco transactions, short-term lending, and participation within the National Payment System, whereas a centralised information repository will enhance regulatory oversight and effectivity.
“Reforms to the Deposit Guarantee Fund will ensure better protection of sacco deposits, reduce government bailout risks, and strengthen the cooperative financial sector. By lowering operational costs, fostering innovation, and boosting public confidence, these reforms position saccos as key players in Kenya’s financial inclusion and economic empowerment agenda,” the cupboard added.
Loss of billions
This comes at a time it was revealed that the Kenya Union of Savings and Credit Cooperatives (Kuscco) may have misplaced as much as Ksh5.3 billion to unhealthy loans issued to saccos and senior officers.
Saccos which have been hit within the heist embrace Mhasibu Sacco whic is ready to lose over Ksh480 million, Kimisitu Sacco will lose over Ksh353 million, Law Society of Kenya Sacco (Ksh19 million), Stima Deposit Taking Sacco(Ksh108 million) and Balozi Sacco Society (Ksh437.5 million).
Some of the sacco societies have been pressured to put in writing off their deposits with Kuscco, taking successful at their members’ deposits.