The 2023 Annual SACCO Supervision Report illuminates the resilience and growth trajectory of the SACCO industry in Kenya. Despite the pervasive challenges posed by the economic environment and regulatory constraints, SACCOs have admirably managed to not just survive but thrive, marking a notable advance in membership and financial performance.
With membership ticking upwards by 6.57% to 6.84 million, the report underlines a promising yet cautious tale of growth. This increase, though significant, still captures less than 30% of Kenya’s adult working population. This disparity directly points to the immense potential for further penetration and growth of the SACCO industry. Countries with over 40% penetration rates, as highlighted by the World Council of Credit Union statistics, serve as a benchmark and a beacon of what is achievable with focused strategies and conducive policies.
The role of SACCOs in fueling socio-economic development through affordable credit facilities across various sectors cannot be overstated. From agriculture to housing and education, these cooperatives continue to be pivotal to household economies and the broader national economic fabric. The reported increase in the loan portfolio by 11.50%, reaching Kshs 758 billion in 2023, is a testament to the sector’s robustness and its critical role in economic empowerment.
It’s worth noting, however, that the issue of deposit growth lags behind loan portfolio growth, which signals a financing gap that needs attention. This opens avenues for discussion on the sustainability of relying heavily on member share capital and retained earnings for financing.
Moreover, the call by the Ministry to align with the Government’s policy vision through the proposed Federation of SACCOs is a strategic move towards bolstering good governance within the industry. This approach not only aims at curtailing mismanagement but also promotes self-regulation and ensures SACCOs uphold high ethical standards, which are indispensable for trust and growth.
The hosting of the SACCA congress is a golden opportunity for Kenya to showcase its achievements on a global stage, attracting attention and possibly investment that could further fuel the growth of SACCOs and the cooperative movement at large.
The report, through the lens of Cooperatives and MSMEs CS Wycliffe Opranya, paints a picture of a sector on the rise but not without its share of challenges. It calls for a collaborative effort among all stakeholders to continue the upward trajectory, enforce compliance, and educate the public on the dangers of engaging with unlicensed financial entities. The SACCO industry’s contribution towards achieving Kenya’s economic aspirations, as articulated in the Bottom-up Economic Transformation Agenda and the Kenya Vision 2030, remains unequivocal and of great national importance.
