Cooperatives are losing money through litigations affecting their operations. According to the Nationwide Co-Operative Sector Baseline survey, litigations between members and cooperatives cost them Ksh 135 million in legal fees, employees and cooperatives (Ksh 45 million), and fines (Ksh 24 million).
The survey conducted in the second half of 2019-2020 and the first half of 2020-2020 financial years has revealed that there are 23,275 cooperatives registered in the country. Out of the number, only 8,814 cooperatives are active, translating to 60.15%, with 117 having their registration cancelled and 8,621 have no required registration details.
Cooperative sector remains a key driver of the country’s economic development, with a reported Ksh 8.791 trillion injection to Kenya’s GDP in 2018.
The survey also shows that the sector generated total revenue of Ksh 137.26 billion in the year 2018, with accumulated deposits of Ksh 844.55 billion, which translates to 25.91% of national savings. The sector had export earnings of Ksh 20.839 billion.
The sector had a membership of over 6,535, 000. Cooperatives owned land worth Ksh 52.33 billion, amounting to 59,423 acres of December 31st, 2018.
The sector’s main challenges include a low level of technology uptake in the county cooperative offices, where the information and communication tools are hardly available, underfunding of the cooperative sector, and the relatively low levels of management and supervisory skills.
Generally, cooperatives in Kenya are principally involved in savings and credit business (53.67%), agriculture and marketing activities (40.16%), and housing (11.65%).
Nairobi County has the highest number of registered cooperative societies, followed by Kiambu County.
The survey also notes that the cooperative sector employs more than 300,000 people, besides providing opportunities for self-employment to many others. The majority of the employees are women at 57 per cent, while one-third of employees are youth.
Many of the employees had a formal education, with 31.95 per cent having a college education and another 26.7 per cent having attained secondary level education.
Besides the provision of financial services to members, cooperative societies also provide a variety of welfare-related services to their members, with benevolent funds topping the list, followed by health insurance.
