Cooperative and MSMEs Development Cabinet Secretary Wycliffe Oparanya has issued a stern warning to cooperative societies, unions, national cooperative organizations, and apex cooperatives that fail to meet the legal requirement of filing annual returns by the end of April 2025. These organizations are at risk of deregistration, which would lead to their removal from the Cooperative Register and the loss of their corporate status.
Oparanya’s announcement came during an Ethical Leadership and Governance forum held in Naivasha, organized by the Cooperative Alliance of Kenya (CAK). The event gathered influential cooperative leaders, government officials, and stakeholders to discuss urgent issues affecting cooperatives across the country.
Under the Cooperative Societies Act, every cooperative is mandated to file annual returns by April 30 each year. These returns include approved audited financial statements for the relevant year and updated records of all elected officials, including their full names, physical addresses, telephone numbers, and email contacts.
“We have observed a worrying trend where an increasing number of cooperative societies are failing to meet this legal obligation, exposing themselves to the risk of deregistration,” Oparanya stated. He emphasized that any Society failing to file returns for three consecutive years within the mandated timeframe will face immediate removal from the register.
This stance indicates the government’s commitment to holding cooperatives accountable and ensuring that only compliant and well-managed organizations remain operational.
The cooperative sector plays a vital role in Kenya’s economy, contributing approximately 35% to the nation’s GDP and providing essential financial services to millions of Kenyans, particularly those excluded from conventional banking. With over 31,000 cooperatives registered, mainly Savings and Credit Cooperative Organizations (SACCOs), the sector is crucial for promoting financial inclusion and addressing socioeconomic challenges.
However, the sector has faced significant challenges, including financial mismanagement and corruption, leading to declining public trust. Oparanya acknowledged these issues, stating, “The erosion of public trust in cooperatives due to poor management and governance failures has severe consequences for the communities that rely on them.”
To maintain relevance in an evolving economic landscape, cooperatives must fulfill legal obligations, implement governance reforms, and foster inclusive leadership. Oparanya’s warning about potential deregistration serves as a reminder that compliance is essential for survival.
As Kenya prepares to implement the Cooperatives Bill, 2024, and transitions to a delegate representation system, cooperative leaders are urged to prioritize transparency, accountability, and sustainable growth. The decisions made today will heavily influence the future of the cooperative sector, either establishing resilient institutions that empower communities or leading to fractured systems incapable of meeting modern challenges.
