Kenya’s cooperative regulator has issued a warning to non-withdrawable deposit-taking SACCOs, declaring that structural reform and professional governance are no longer optional.
The Sacco Societies Regulatory Authority (SASRA) held its inaugural Regulatory Round Table for Non-Withdrawable Deposit-Taking (NWDT) SACCOs recently in Nakuru, bringing together sector leaders and government officials to chart a compliance roadmap for a segment controlling Ksh 140 billion in assets.
“One shilling in a Sacco is equal to one shilling in a bank,” SASRA Chairperson Jack Ranguma said. He added that the authority’s new Risk-Based Supervision System would monitor institutional health in real time through a central digital dashboard.
Acting CEO David Sandagi revealed that SASRA oversees 352 SACCOs holding a combined Ksh 1.2 trillion in assets, with the NWDT segment accounting for Ksh 104 billion in deposits — 12 percent of total industry deposits.
Patrick Kilemi, Principal Secretary for Cooperatives delivered a wide-ranging reform manifesto covering governance failures, financial mismanagement, and the proposed Cooperative Bill.
Kilemi warned of thousands of SACCOs operating below SASRA’s regulatory threshold with inadequate oversight, calling it “the sector’s next frontier.” He also raised the alarm over digital fraud, specifically haircut deductions — small amounts quietly skimmed from large numbers of member accounts — and called for regular reconciliation as a basic safeguard.
His harshest criticism targeted board governance. Unlike mature cooperative markets where CEOs run operations and boards provide oversight, he noted some Sacco board chairs routinely interfere in daily management and punish executives for professional judgment.
“Let us agree on how we’ll be measuring the performance of our people,” Kilemi urged, calling for formalised contracts and structured accountability.
