In a strong push to restore trust and efficiency in Kenya’s SACCO sector, the government has launched two major initiatives aimed at reforming how these financial cooperatives operate.
Speaking on Wednesday, May 21, Cabinet Secretary for Co-operatives and MSMEs, Wycliffe Oparanya, announced the creation of a new leadership board for the Kenya Union of Savings and Credit Cooperatives (KUSSCO). At the same time, he unveiled a special five-member task force of experts charged with reviewing outdated SACCO laws.
Oparanya said the team will focus on overhauling the SACCO Societies Act of 2008. “The regulatory framework is lagging behind. This review will pave the way for better governance and stronger institutions,” he stated. The experts will assess current laws, identify gaps, and propose reforms to modernize the sector.
During this review period, the government has put a hold on registering new SACCOs, an initial freeze lasting three months as it awaits the committee’s recommendations.
Among the key reforms on the table: establishing a Central Liquidity Facility to help SACCOs manage cash flow crises, creating a Deposit Guarantee Fund to safeguard member savings, and tightening regulations around shared services.
The move comes in the wake of governance scandals that have shaken public confidence in SACCOs prompting urgent government intervention to protect the savings of millions of Kenyans.
