The Co-operative Movement in Kenya has mobilized savings to the tune of USD 6.7 billion, commands an asset base of above One Trillion shillings, and granted members loans to the tune of USD 7.98 billion, according to the 2019 World Council Statistical Report. The report notes the country has 8,033 credit unions with a membership of 8,551,540, adding that the movement has reached about 27.9 percent of Kenyans. This is a big achievement for the country, and the government should continue providing a conducive environment for the co-operative growth through enacting enabling legislations.
 The challenges being experienced by some co-operatives in the country such as include poor governance and misappropriation of members’ savings, investment in non-core activities, high levels of external borrowings, high non-performing loans, obsolete technology and cybercrime, non – remittance amongst others, must also be addressed fully. The State Department for Co-operatives (SDC) should also finalize the National Co-operative Development Policy to address the deficiencies in the co-operative movement.
To enhance members’ deposits’ safety, the government should fasten the formulation of regulations that bring on board BOSA Saccos with deposits of over 100 million shillings under the Sacco Societies Regulatory Authority (SASRA).
Good corporate governance is a core element for the growth and development of any institution. This makes it imperative for all co-operative societies to institutionalize ethics and sound governance principles in their operations. This will include effective monitoring mechanisms, adherence to the code of ethics; promotion of integrity in societies’ leadership; and entrenching teamwork and professionalism in Co-operative Management.
This practice will promote savings culture, facilitate fair credit administration, enhance competitiveness, eliminate loan delinquency, and protect members’ deposits and assets.
The Department for co-operatives should continue to create a conducive environment for the co-operative sector through appropriate policy, legal framework, standards, and strategies that will help the movement participate effectively in delivering the National Government’s Big Four Agenda.
The co-operatives have been identified as critical partners for delivering the Big 4 Agenda of the National Government. The Ministry should strengthen farmers based co-operatives to carry out the value addition, to increase their competitiveness and returns to members. Co-operatives are encouraged to provide auxiliary services like warehousing, transport, distribution, and market linkages.
Housing co-operatives are expected to provide 25% of the 500,000 houses required across the country under the Low-Cost Affordable Homes (LCAH) program.
It is a good move that the State Department of Co-operative Development is engaging other implementing government agencies and private developers, including financial institutions and manufacturers of building materials, to enable co-operative societies to develop an appropriate delivery framework and action plan. This creates an essential window for Saccos to develop relevant mortgage products to finance members interested in purchasing or constructing their own houses under the LCAH program.
To facilitate faster growth in Savings Mobilization, the Ministry has been promoting Sacco’s for Kenyans in the Diaspora. This aims to tap into this group’s enormous potential and channel their savings for investment and Socio-economic development in a structured manner. So far, 19 societies have been registered. To make these co-operatives more effective, the government has converted these co-operatives from Saccos to investment co-operatives to enable Kenyans in the Diaspora to invest in Kenya through these co-operatives.
