Time flies with great content! Renew in to keep enjoying all our premium content.
Prime
Saccos with 3-year audit lapse now face deregistration
Cooperatives and Micro, Small, and Medium Enterprises Cabinet Secretary Wycliffe Oparanya addressing journalists during the inauguration of the Committee of Experts to review the Sacco Societies Act and the inauguration of the new Kenya Union of Savings and Credit Cooperative Organisations (Kuscco) Board at NSSF Building in Nairobi on May 21, 2025.
Savings and credit cooperatives societies (Saccos) that have not filed audited financial statements with the Ministry of Co-operatives for the past three years, will be deregistered and stopped from mobilising deposits.
Ministry of Co-operatives and Micro, Small and Medium Enterprises Development Wycliffe Oparanya said there has been an increasing number of co-operatives failing to file their annual returns, including approved copies of audited financial statements, leaving government and members in the dark.
Now the ministry says it wants to deregister all such entities as part of the efforts to improve transparency and accountability in the sector that holds over Sh1.3 trillion deposits. Other disclosures that cooperatives are required to give each year are the up-to-date details of all elected officials including their full names, physical addresses, telephone numbers, and email addresses.
“We have observed a growing number of societies failing to meet this legal obligation, thereby exposing themselves to the risk of deregistration,” said Mr Oparanya during the ethical leadership and governance forum held last Thursday in Naivasha.
“Let me be clear: any co-operative society that has failed to file its returns for the last three years and within the stipulated timelines will be struck off the Co-operative Register and will cease to exist as a corporate entity. This directive takes immediate effect, and all co-operative entities are expected to comply fully.”
The directive comes on the back of governance lapses in various Saccos having cost members billions of shillings, with fingers being pointed at senior management.
The Kenya Union of Savings and Credit Co-operatives (Kuscco), an umbrella body for Saccos, recently suffered a Sh13 billion heist that was linked to key figures in management who have since been fired and sued.
Co-operative societies rules require cooperatives to file their annual returns no later than April 30 of each year.
The ministry is also going after saccos that have denied members a chance to participate in the affairs of saccos by failing to organise annual general meetings (AGMs).
Mr Oparanya said those with very large membership have ended up holding “disorganised” AGMs. He has therefore directed cooperative societies with more than 10,000 members to amend their by-laws within the next six months to adopt a delegate system of representation at AGMs.
“This representation must be fair and inclusive, taking into account geographical distribution, gender balance, age diversity, and the inclusion of persons with disabilities,” said Mr Oparanya.
Co-operative Alliance of Kenya Executive Director Daniel Marube said its members are aligned with the directives of the ministry, saying that this will be crucial in helping grow the sector past the Sh1.8 trillion asset base held by more than 28,000 co-operatives across the country.
“The small things that many saccos ignore is what ends up creating leakages. We agreed to seal those leakages as soon as we recognise them... That is the only way we can grow the sector,” said Mr Marube.
Last month, Mr Oparanya announced a moratorium on the registration of new saccos for at least three months as the ministry started the process of overhauling the sector’s regulations.
The ministry appointed a committee of experts to, among other deliverables, guide in the creation of a sacco deposit guarantee fund that will shield savers from total losses in case any sacco collapses.
