- SASRA has highlighted voluntary mergers as an option for strengthening regulated Saccos.
- Proposed legislation requiring smaller Saccos to merge has sparked debate across the sector.
- Smaller cooperatives warn that compulsory mergers could threaten grassroots financial inclusion.
The Sacco Societies Regulatory Authority (SASRA) has reported that two regulated Savings and Credit Cooperative Societies (SACCOs) successfully amalgamated through an acquisition in 2025.
The development comes as the push to consolidate the cooperative sector gains momentum amid growing opposition to proposed legislation targeting smaller SACCOs.
According to the SACCO Supervision Annual Report 2025, Nufaika SACCO Society Ltd voluntarily resolved to join Fortune SACCO Society. The move marks a significant step in using mergers and acquisitions to strengthen struggling cooperatives.
SASRA said the transaction shows growing acceptance of voluntary amalgamations, acquisitions and mergers. It described them as a practical way of supporting SACCOs facing financial or operational difficulties while ensuring members keep receiving services.
SASRA Board Chairman CPA Jack Ranguma said the authority considers such arrangements an important supervisory tool. In his view, they promote financial stability and protect members’ interests without resorting to dissolution where viable alternatives exist.
Meanwhile, the government and SASRA are pushing for greater consolidation in the sector. The aim is to strengthen financial stability, improve oversight and allow institutions to benefit from economies of scale.
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The proposed Sacco Societies (Amendment) Bill, 2025, for which public participation has already been held, has emerged as a key point of debate. Particularly contentious are provisions that would compel smaller SACCOs with deposits below Ksh 100 million to merge with larger institutions.
Supporters of consolidation argue that stronger, better capitalised SACCOs would be better placed to withstand financial shocks. They add that such institutions would improve governance and protect members’ savings.
However, the proposed changes have raised concerns among smaller cooperatives. They warn that mandatory mergers could threaten their survival, lead to job losses and weaken financial inclusion at the grassroots level.
Ammar SACCO Chairperson Jeremiah Njoroge had earlier cautioned that the legislation could cripple small cooperative societies and undermine access to financial services if enacted in its current form. He argued that forcing SACCOs below the proposed threshold to merge with larger institutions could endanger community based cooperatives. These societies, he said, play a critical role in serving low income households.
Indeed, many rural residents rely on smaller SACCOs as their primary source of affordable credit, savings products and financial literacy. This is especially true in areas where access to commercial banking services remains limited.
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