SACCOs have been cautioned against exposing members’ savings to high-risk investments, including special funds and offshore placements, as the sector’s financial investment portfolio expanded sharply in 2025.
Principal Secretary for Co-operatives Patrick Kilemi urged Sacco managers and directors to prioritize prudence, sound risk management and members’ interests when making investment decisions.
The sector’s financial investments rose 63% to KSh99.81 billion in 2025, up from KSh61.21 billion in 2024, reflecting a significant increase in funds allocated to investment assets.
Investments in collective investment schemes, including money market funds and unit trusts, more than tripled to KSh19.55 billion, while holdings in government securities rose to KSh23.64 billion.
Kilemi cautioned Sacco leaders against pursuing higher returns at the expense of the safety and accessibility of members’ funds. He emphasized the importance of proper risk controls and adequate liquidity to ensure institutions can meet their financial obligations.
The warning highlights the growing need for Sacco to balance investment returns with capital preservation and liquidity as their investment portfolios expand. It also places responsibility on boards and management to ensure investment decisions are supported by sound risk assessments and effective oversight.
