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Corruption is a strange industry. It can take only three people, one working full time and the other two as “sleeping” directors, a few months to make a profit of Sh500 million. To make the same amount in a month, it takes some of our best known companies a lot of man hours, billions of shillings in capital and infrastructure.


This makes one thing clear, corruption spawns laziness and unemployment and stifles business opportunity. Even worse it makes markets unstable as those who make money easily also spend it lavishly making things more expensive.


The ordinary man is therefore an alien as the journey to wealth seems impossible without access to State power and coffers. In fact, for most of us, our friends with new cars and new houses are more often than not doing a “deal”—they recently got the title ‘mheshimiwa’.

As we fight against corruption, we must look at ways of making the average Kenyans to also access wealth. In fact, it is important that they are enabled to access wealth in a legitimate way, otherwise all we will have is a population waiting for their chance to eat, if it is not the case already.


You see in a corrupt system, hard work, intelligence and integrity do not lead to success because corruption would much rather gift the most vile and violent among us as they tend to do the evil deeds necessary to secure their success.


The rags-to-riches story, through the right channel, is becoming almost impossible in our country. Even established businesses are struggling while corruption is making millionaires and billionaires.


There needs to be a way out for the average Kenyan and that way has to be some sort of a co-operative. There needs to be an amalgamation of ideas and capital to propel Kenyans to success and wealth.

The statistics seem to favour this movement. Today, co-operatives hold over 40 per cent of the GDP and 35 per cent of total savings in the country. This means if they are supported further they can easily change our country. The fact that they are easy to join also means they can easily distribute wealth to larger swathes of the population.


Kenyans need to have processes through which they can succeed and through large co-operatives they should not only be able to afford credit cheaper but also see their savings grow as co-operatives invest and use member funds wisely to prosper them.This will save the dual problem of access to affordable credit as well as financial growth. As large co-operatives, they can also demand larger chunks of the national cake through lobbies and capital might.


It would be interesting to see a future where co-operatives pool resources to tender for government jobs. This would possibly mean that a co-operative of plumbers can be contracted by the Ministry of Works to deliver plumbing services to a city, for example.


This would mean that the co-operative would be able to give its members access to employment while making them profits, which they would never have accessed as individuals.

This kind of business model would also deal a heavy blow to corruption because those involved would be unlikely to sabotage their own sacco. At the same time we would have successfully managed to remove tenders from the high and mighty and made them available to the average Kenyan.


Saccos also have the capacity to amalgamate votes in a non-tribal setting. Each savings and credit co-operative (sacco), by nature, puts people with similar careers, businesses or goals together regardless of tribe.



Co-operative sector umbrella body Kenya Union of Savings & Credit Co-operatives (Kuscco) has secured Sh750 million for on-lending agri-based societies through a USAid Cooperative Development Programme (CDP).

The ‘Kilimo’ loan product, jointly developed by the Kuscco and the World Council of Credit Unions, will benefit co-operative societies dealing in horticultural, cereals and dairy activities.

The Kuscco said co-operative societies with established activities that benefit farmers and have a ready market for products would benefit from the programme.

Woccu World Council CDP director Jean Thiboutot unveiled the fund following the conclusion of an eight-year Improving Small Rural Producers Income through Integrated Access to Financial Services and Agricultural Markets project.

“It is always inspiring to see our CDP projects result in financial products and services people can easily access and utilise to improve their quality of life,” said Mr Thiboutot when he commissioned an irrigation system and a borehole sunk for the 90-member Kanoto Horticultural Farmers’ Cooperative.

Kuscco said participating co-operative societies must have saved with umbrella body for more than six months, other terms.

The irrigation system will allow Kanoto farmers to enhance the production of French beans for export.

Kuscco said societies in semi-arid areas with active members, sound financial records and are certified as producers by horticultural export agencies with good farming history qualify to apply for the funds.


Savings and Credit Co-operative Societies (Saccos) increased their provisions for non-performing loans by 42.5 percent to Sh15.26 billion in the year ended December 2018 driven by adoption of new accounting standard.

This beat the previous year where provisions grew by 23.44 percent and pushed non-performing loans (NPL’s) provision as a share of Saccos’ total expenses to 5.59 percent from the previous year’s 3.62 percent.

The huge increase in the loan loss allowance from 2017’s Sh10.71 billion came in the period saccos switched to International Financial Reporting Standard (IFRS) 9 from International Accounting Standard 39.

“The sharp increase in the provisioning for loan losses was occasioned by the implementation of IFRS 9 by saccos, which led a relatively higher provision than previously undertaken,” Sacco Societies Regulatory Authority (Sasra) says in an industry report.

IFRS 9 is forward-looking as opposed to the historic-looking IAS 39 and therefore calls for increased allowance for loans that remain unpaid for 90 days.


Finally, the more than 15 million members of Savings and Credit Co-operatives (Saccos), can rest easy following the withdrawal of a Bill that sought to introduce a special category of members known as Social Impact Members (SIMs).

The move would not only have changed the composition and governance of these financial institutions but could also have put members’ funds at risk.

The Sacco sector in Kenya is the largest in Africa, and according to numbers provided by the regulator SASRA, Saccos have mobilised over Sh800 billion in domestic savings, and boast an asset base of over Sh1 trillion, employing over 2 million Kenyans directly and indirectly.

This growth has not been entirely painless and for the past several years there have been calls and efforts to streamline this sub-sector due to incidences of mismanagement, fraud and bad loans.

The proposed SIMs Bill, according to sector players, would have plunged the sector into troubled waters and greatly undermined efforts to improve and safeguard Sacco operations.

On the face, the Bill presented to Parliament was well-intentioned as it sought to make credit available to those looking to invest in start-ups, currently highly underfunded since financiers like banks consider them high risk.

However, the Bill proposed two amendments which proved contentious with sector players, especially the creation of a special group of members, the Social Impact Members (SIMs), who would enjoy total autonomy.

As it stands, for one to become a member of a Sacco one needs to purchase a set minimum number of shares, however, all members have equal voting rights irrespective of the number of shares held. This democratic voting right is exercised during AGMs to vote for or against proposed resolutions.

These membership rules would have however not been applicable to the Social Impact Members, SIMs. The withdrawn Bill had proposed an amendment of the Co-operative Societies Act introducing this new class of members who would not have been required to purchase shares like the other members.

The SIMs admission would have been through a simple resolution at the AGM. Despite not being registered members, the SIMs would have however still held equal voting rights with other members. 

According to the umbrella body for Saccos in Kenya, KUSCCO, which has been at the forefront in lobbying against the contentious amendments, the proposed SIMs admission criteria would have been tantamount to diluting the economic democracy of these financial institutions.

Had it been passed, this proposal would have been in violation of the third co-operative principle on economic member participation requiring that members contribute equitably to the capital of their co-operative.

Secondly, the Bill had also proposed an amendment of the Sacco Societies Act to introduce a Special Fund which would lend to eligible individuals looking to invest in start-ups. This fund would solely be financed by the SIMs, and one of the major concerns expressed by Sacco players was that the source of these monies would remain unknown to the larger Sacco membership, and this would have left the financial institutions open to even more risks.

According to the Saccos, one of the major risks they were facing with these changes was the threat of money laundering. Section 44 of the Proceeds of Crimes and Money Laundering Act, 2009 requires financial institutions to monitor and report suspected money laundering activity.

However, with the SIMs, the Sacco would have no way of verifying and monitoring the source of the Special Fund. Further, section 45 of the same act requires financial institutions to verify customer identity. However, if this proposal had sailed through, Saccos would have had no capacity of verifying the identity of the SIMs, since they are not members of the Society in the first place.


A majority of deposit-taking Saccos in Kenya are experiencing financial instability due to failure by state agencies and private companies to remit statutory deductions on time.

As the government streamlines savings and credit co-operative societies that are reeling under the weight of mismanagement, fraud and bad loans, failure by employers to remit deductions is increasingly becoming a big threat to the survival of many saccos.

To tackle this, the Sacco Society Regulatory Authority (Sasra) is developing legal and institutional proposals to protect saccos from such employers.


Sasra statistics show that by end of last year, employers in the public and private sector owed deposit taking saccos $26.7 million in unremitted deductions.

The deductions were in the form of either loan recovery or non-withdrawable deposit accounts, popularly known as back office service activities.

Of the unremitted deduction, 79 per cent were meant for loan repayment and 21 per cent for non-withdrawable deposits contributions.

“The perennial failure by various employer-institutions to remit deductions made from employees’ emoluments has had serious adverse effects on the financial soundness of various saccos,” said John Mwaka, Sasra chief executive through a circular seen by The EastAfrican.

Among the challenges saccos are facing include failure to meet and maintain prudential standards especially the liquidity ratio and capital adequacy ratio, liquidity constraints making it impossible to issue new loans and plunging them deeper into loss making.

The problem is compounded by the new stringent IFRS9 financial reporting standards that have hit all deposit-taking saccos further squeezing earnings.

Under IFRS9, capital adequacy, asset quality, earnings and liquidity remains key criteria for monitoring, evaluating and measuring the financial soundness and stability saccos.



ISO 9001


We commit to consistently promote SACCOs through advocacy and provision of quality technical and financial products that exceed the members’ expectations.
We shall comply with the statutory requirements and actively pursue continuous improvement of the ISO 9001:2015 Quality Management System (QMS) processes, capabilities and effectiveness.
In pursuit of our commitment we shall ensure that the quality policy and objectives that have been established and communicated to the Union employees shall be reviewed annually in accordance with the stipulated framework and quality standards.”