Oparanya directs large SACCOs to embrace delegate representation within six months

All Savings and Credit Cooperative Organizations (SACCOs) with membership exceeding 10,000 have been directed to implement a delegate system of representation within six months. The directive forms part of broader set suggestions intended to regulate the sector.

The Ministry of Cooperatives and MSMEs Development, under the leadership of Cabinet Secretary Wycliffe Oparanya, observed that SACCOs and cooperatives with large membership bases struggle with cumbersome decision-making processes due to challenges in holding annual meetings.

In light of this, Oparanya ordered SACCOs affected by the threshold to revise their by-laws within six months and adopt a delegate representation structure. According to this new model, a maximum of 500 delegates will be selected to represent the entire membership body during general meetings.

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“I am directing that all cooperative societies with a membership exceeding 10,000 must amend their by-laws within the next six months to adopt a delegate system of representation,” Oparanya declared.

“This representation must be fair and inclusive, taking into account geographical distribution, gender balance, age diversity, and the inclusion of persons with disabilities.” He elaborated further on the structure of the system, emphasizing that inclusivity must be a key principle in its implementation.

This initiative was announced during the Cooperative Leadership Forum, where Oparanya outlined an array of additional governance reforms aimed at strengthening the leadership of SACCOs. One of the critical requirements introduced was the compulsory commitment of board members and senior managers to continuous training intended to prepare leaders to manage the legal, financial, and ethical challenges associated with steering modern cooperatives.

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The training will also promote globally recognized cooperative practices, such as improved transparency through open reporting, mandatory independent audits, and active member-driven oversight.

In his address, Oparanya further disclosed that the government is actively supporting cooperatives by providing technical tools and relevant knowledge to manage both operational and financial risks.

“We are also exploring partnerships with financial technology firms to introduce advanced risk management solutions. These tools will enhance the resilience of cooperatives, particularly in managing credit portfolios and addressing emerging financial risks,” he said.

These fresh policy shifts build on previously introduced reforms. Such as the establishment of the Deposit Guarantee Fund, through the SACCO Societies Act. The fund is designed to safeguard members’ savings, reinforce financial stability, and restore confidence in the cooperative movement.\

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Additional measures include the appointment of a five-member Committee of Experts responsible for revising and updating the SACCO Societies Act of 2008, ensuring its alignment with international standards and enhancing accountability. Furthermore, a new two-year Transition Board has been set up to guide structural transformation within the Kenya Union of Savings and Credit Cooperatives (KUSCCO), ensuring that member interests are preserved during the transitional period.

By Masaki Enock

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