- Saccos have set aside billions as losses tied to their KUSCCO investments
- KUSCCO is moving towards liquidation after members approved the process
- Sasra is strengthening digital supervision as new financial and cyber risks emerge
Savings and Credit Co-operative Societies (Saccos) that had invested shares and deposits with the Kenya Union of Savings and Credit Co-operatives (KUSCCO) have made provisions for the funds in line with applicable financial reporting standards, the government has said.
The outstanding balance reported by Saccos in KUSCCO now stands at Ksh7.76 billion, down from the previously reported Ksh16.1 billion.
Cooperatives and MSMEs Development Cabinet Secretary Wycliffe Oparanya said the reduction followed provisions made by affected Saccos after determining that the funds could no longer be considered recoverable.
“Although painful, this is a necessary and prudent reporting decision,” Oparanya said, commending Saccos for taking the action and the Sacco Societies Regulatory Authority (SASRA) for providing regulatory guidance.
Efforts to revive KUSCCO have failed amid what the government described as the organisation’s deep insolvency. Members recently resolved at a General Meeting to place the umbrella body under liquidation in accordance with the Co-operative Societies Act and other applicable laws.
Speaking during the official release of the Sacco Supervision Report 2025 on Monday, September 28, 2026, the Cabinet Secretary said the liquidation process will be accompanied by measures to ensure that the advocacy role previously played by KUSCCO is addressed while safeguarding the stability of Kenya’s Sacco movement.
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Oparanya also commended SASRA for rolling out its Risk-Based Sacco Supervision System, a digital platform designed to streamline regulatory processes.
The platform supports the registration of external auditors, applications and renewals for licences and authorisations, complaints handling and corporate applications. According to the Cabinet Secretary, the system will strengthen regulatory information management, surveillance and analytical capacity while improving efficiency.
He urged SASRA to continue strengthening the platform’s security, reliability and accessibility to ensure that digitalisation reduces compliance costs and improves service delivery.
Oparanya further called on the regulator to remain vigilant against emerging risks, including cybercrime, climate-related shocks, changing economic conditions and risks associated with evolving financial technologies.
He said SASRA should continue reviewing audited financial statements before they are presented to Sacco members.
The Cabinet Secretary also reiterated that Saccos should not obtain external borrowing for the purpose of paying dividends or interest on deposits.
“Borrowing may only be undertaken with the approvals required by law and for legitimate, productive and sustainable purposes,” he said.
Oparanya urged Kenyans to transact only with Saccos that are licensed or authorised by SASRA where such approval is required by law.
He advised members of the public to verify the regulatory status of any institution presenting itself as a regulated Sacco before joining or depositing money.
The government said such checks can help protect the public from financial losses and prevent unregulated entities and pyramid-style schemes from exploiting unsuspecting Kenyans.
By Obegi Malack
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