The SACCO Societies Regulatory Authority (SASRA) has raised concerns over the stability of Kenya’s SACCO sector after new data revealed that the bulk of cooperative deposits are concentrated in a small fraction of wealthy accounts, even as millions of low‑value savers continue to join the movement.
According to SASRA’s supervisory report, total deposit accounts rose 9.74 per cent to 16.05 million in 2024, up from 14.52 million a year earlier. Overall deposits climbed to KSh 749.43 billion. However, the majority of accounts, 14.30 million, representing 89.09 per cent of the total held balances below KSh 50,000, collectively amounting to just 5.86 per cent of industry liabilities.
The real weight of the system lies at the top. Over KSh 566.04 billion, or 75.53 per cent of all deposits, is concentrated in just 694,000 accounts, representing a mere 4.32 per cent of total accounts.
ALSO READ:
SACCO sector posts KSh 845 billion in loans as NPL ratios hold steady amid rising risks
Within this elite group, concentration intensifies further: accounts holding between KSh 300,000 and KSh 1 million account for KSh 284.79 billion, or 38 per cent of deposits, while 140,000 accounts with balances above KSh 1 million hold KSh 281.25 billion, representing 37.53 per cent of industry savings.
SASRA has flagged this imbalance as a risk factor requiring heightened oversight. “The high concentration of deposit accounts with amounts of less than KSh 50,000 within the Large‑Tiered Regulated SACCOs is another reason why the Authority must continue to deploy appropriate supervisory measures on them due to the risk they pose to the industry and the economy as a whole,” the regulator noted.
While the funding base narrows, the deployment of credit is also shifting. The land and housing sector, traditionally the largest beneficiary of SACCO lending, saw its share decline to 25.26 per cent of total advances in 2024, down from 33.24 per cent in 2022. In contrast, agriculture is gaining ground, absorbing 20.05 per cent of all credit in 2024 compared to 13.76 per cent two years earlier, a trend linked to favourable weather and state‑led subsidy programs.
Education remains the cornerstone of SACCO lending, ranking second for the third consecutive year. The sector absorbed KSh 119.49 billion in 2024, mainly to finance school and college fees. Meanwhile, lending to trade, human health, and manufacturing registered marginal declines, reflecting a more cautious approach to commercial credit.
ALSO READ:
Government securities lead SACCO investment portfolios as money market funds rise to 9 per cent
The regulator noted that the reality of inclusion alongside concentrated funding underscores both the strengths and vulnerabilities of Kenya’s cooperative movement, with millions of small savers gaining access to financial services and the sector’s liquidity and lending capacity remaining tied to the financial power of a small fraction of high‑value members.
By Masaki Enock
Get more stories from our website: Sacco Review.
For comments and clarifications, write to: Saccoreview@
Kindly follow us via our social media pages on Facebook: Sacco Review Newspaper for timely updates
Stay ahead of the pack! Grab the latest Sacco Review newspaper!
