The government has lifted its year‑long suspension on the registration of new Savings and Credit Cooperative Organisations (SACCOs), but applicants will now face stricter requirements aimed at strengthening governance and protecting members’ deposits.
Speaking during the launch of preparations for this year’s International Co-operative Day celebrations, popularly known as Ushirika Day, Commissioner for Co‑operative Development David Obonyo announced the resumption, noting that the pause, enforced in May last year, followed governance and operational challenges at several institutions, including Ushuru, Metropolitan Saccos, and KUSCCO.
“The process was paused to allow a technical committee to review the legal framework governing SACCOs. The committee has now submitted its report, and we have resumed registration with stricter conditions aimed at ensuring only viable and stable SACCOs are licensed,” Obonyo said.
Under the new rules, applicants must have at least 1,000 members, KSh1.2 million in operational capital, and sufficient share capital to sustain operations for a year. They are also required to secure a physical office and employ at least one clerical staff member before launching.
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In addition, newly registered SACCOs must demonstrate the ability to mobilise at least KSh10 million within their first year of operation.
Obonyo stressed that the measures are designed to prevent SACCOs from using members’ deposits to cover administrative costs. “We want SACCOs that can sustain themselves and protect members’ savings,” he asserted.
The commissioner further revealed that out of Kenya’s 14,000 registered SACCOs, only about 4,000 consistently file annual returns, raising questions about the viability of the rest.
“That is why we are enhancing the registration threshold, so that Kenyans can have confidence that their money is safe,” he added.
By Frank Mugwe
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