Co-ops registration scuttled by Covid-19

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By Sammy Chivanga

The number of newly registered cooperative societies dropped nearly by a third in the 2019-2020 financial- year.

A government report says Covid-19 disruptions made it difficult for applicants to submit required paperwork.

A sector report shared by the State Department of Cooperatives (SDC) shows that new registrations dropped to 846 or 32% from preceding financial year where 1,237 cooperative societies were birthed.

The number is far adrift from the 1,544 that were registered in the year ended June 2018, showing the disruption that the infectious virus had on the sector.

The SDC had targeted at least 1,200 new registrations at the start of the financial year but the onset of Covid-19 in mid-March hampered registration process.

“The target was not achieved because government restrictions in movement and social distancing requirement in offices affected submission and processing of applications at both counties and SDC,” says the department.

Crucial processes such as name search and registration and writing and submission of key documents such as by-laws usually entail a lot of paper work and travelling especially for county-based outfits.

Kenya imposed measures such as the ban on large gatherings in mid-March and called for social distancing and also closed movement into counties such as Nairobi, which houses key offices for registering cooperatives.

That made it difficult for those who had intended to wrap up registration processes.

The Commissioner for Cooperatives Development Geoffrey Njang’ombe did not issue any concession for applicants in the face of Covid-19 disruptions.

The Covid-19 control measures also led to economic hardships meaning that those who had intended to register societies suffered reduced cash flows.

The economic environment became difficult for setting up new investment and saving vehicles such as cooperatives since many people were reporting layoffs and salary cuts.

Newer cooperatives are usually born out of new companies or new bonds that seek to pool resources together for growth.

The SDC had also targeted to convert at least 20 “Transport Saccos” into Transport Co –operatives (TransCoops) as is required but achieved none owing to Covid-19 challenges.

Deposit – Taking Saccos, which are regulated by the Sacco Societies Regulatory Authority (Sasra), have for long rooted for the transport outfits styled as Saccos to identify themselves as TransCoops.

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