The Co-operative Alliance of Kenya (CAK) has asked Parliament to revise the Sacco Societies (Amendment) Bill, warning that several provisions could undermine the sector’s identity and burden member societies with unnecessary costs.
The CAK presented a memorandum to the National Assembly’s Departmental Committee on Trade, Industry and Cooperatives, chaired by Ikolomani MP Hon. Bernard Masaka, in a sitting that brought together cooperative leaders, principal secretaries, and technical experts.
Drop Credit Union label
The Alliance wants the term “Credit Union” removed from the bill, arguing it misrepresents Kenyan SACCOs, which combine savings and credit functions — unlike credit-only cooperative models the term implies.
On the Stabilisation Protection Scheme
The CAK recommends that the proposed scheme be run by the Sacco Societies Regulatory Authority (SASRA) and funded through industry penalties and private capital, rather than placing the financial burden on member societies.
Separate deposit protection from banks
The Alliance insists that any new Deposit Guarantee Fund must remain separate from the Kenya Deposit Insurance Corporation (KDIC), which covers banking institutions only. Merging the two, it warns, would erode the cooperative principles of autonomy and member ownership.
Kenya National Police SACCO CEO Solomon Atsiaya cautioned against applying bank or microfinance regulatory models to SACCOs, arguing the sector has outperformed more rigidly regulated counterparts.
“This model has worked — why can’t we protect this model and empower SASRA to regulate our Saccos very well?” he said.
Vice Chairperson Hon. Marianne Kitany (Aldai) urged the government to align its legislative position with the Committee of Experts’ findings before proceeding, warning against conflicting presentations that could delay or weaken the bill.
The committee is expected to hold further sittings to reconcile the government’s position with the CAK’s recommendations and the expert report. Outstanding issues include the financing of the Stabilisation Protection Scheme, the definition of eligible entities, and compliance timelines — particularly for smaller community-based SACCOs.
