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Cooperatives Cabinet Secretary Mr. Hon. Wycliffe Ambetsa Oparanya on Wednesday released the SACCO Supervision Annual Report 2023, providing an in-depth analysis of the state of Savings and Credit Cooperative Organizations (SACCOs) in Kenya. The report highlights the sector’s resilience and growth despite facing challenging economic conditions and several policy and market limitations.
CS Oparanya expressed satisfaction with the continued expansion of the SACCO industry, noting a 6.57% increase in total membership among the 357 regulated SACCOs, rising from 6.42 million in 2022 to 6.84 million in 2023. “This is a commendable growth rate,” he remarked, “but we must not forget that it represents just under 30% of the total adult working population in Kenya. There is still substantial room for growth, especially when compared to countries with over 40% penetration rates.”
The report underscores the critical role SACCOs play in providing affordable credit facilities to households, primarily funded by members’ savings and share capital. The loan portfolio of regulated SACCOs grew by 11.50% in 2023, reaching Kshs 758 billion, a slight decline from the 11.67% growth recorded in 2022. Despite this, the growth rate of deposits lagged slightly behind, increasing by 9.95% in 2023 compared to 9.84% in 2022. This gap in financing was largely covered through member share capital and retained earnings.
Addressing the issue of governance within SACCOs, CS Oparanya acknowledged that despite ongoing efforts to improve the legal and regulatory framework, challenges such as mismanagement and corruption persist. He emphasized that addressing these issues cannot be the sole responsibility of the government. “I call upon the SACCO industry to quickly align itself with the government’s policy vision as captured in the Cooperative Bill 2024, which proposes the formation of a Federation of SACCOs. This Federation should be the custodian of good governance, promoting and upholding best practices through public education and self-regulation,” he stated.
The CS also outlined the government’s commitment to further supporting the SACCO industry through policy initiatives, including expanding the jurisdiction of the Cooperative Tribunal to expedite dispute resolution, introducing stricter compliance regulations with robust enforcement, and raising public awareness about remittance obligations.
Looking ahead, CS Oparanya announced that Kenya will host the SACCA Congress from October 6-12, 2024. The event, Africa’s largest financial cooperative gathering, will convene over 2,000 SACCO professionals from 42 countries across five continents. The congress will highlight Kenya’s success in the SACCO industry and its role in driving economic empowerment and poverty alleviation, aligned with the Bottom-up Economic Transformation Agenda and the Kenya Vision 2030 aspirations.
In conclusion, CS Oparanya called on all stakeholders, particularly the media, to play an active role in educating the public about the risks associated with unlicensed SACCO entities and pyramid schemes, stressing the importance of engaging only with licensed and regulated institutions for financial security.
The SACCO Supervision Annual Report 2023 reinforces the significance of cooperative enterprises in Kenya’s economic landscape and the government’s ongoing efforts to ensure their growth and stability.
