- Education loans surged by 27.1% in Q1 2026, reaching KSh24.81 billion, making school fees the second-largest reason for Sacco borrowing after land and housing.
- Parents increasingly prefer SACCOs for financing education, attracted by lower interest rates and flexible repayment plans compared to commercial banks.
Parents are increasingly relying on Savings and Credit Cooperatives (Saccos) to finance their children’s education, with school fees now ranking as the country’s second-largest reason for borrowing after land and housing.
Education loans rose by 27.1 per cent in the first quarter of 2026 to reach Ksh24.81 billion, surpassing credit extended to businesses engaged in trade and other commercial activities.
The education sector became the second-largest recipient of Sacco lending after land and housing, with members borrowing Ksh30.04 billion between January and March 2026.
According to new data released by the Sacco Societies Regulatory Authority (SASRA), regulated Saccos disbursed a total of Ksh115.73 billion in loans during the first quarter of the year. Land and housing accounted for the largest share at Ksh33.74 billion, followed by education, highlighting the increasing demand for education financing among Sacco members.
The lending trends show that land and housing remained the top destination for Sacco credit, followed by education and agriculture, reflecting members’ continued focus on property investment, education, family welfare and food production.
“Between January and March 2026, regulated Saccos disbursed Ksh24.81 billion towards education-related needs, including school fees, college education, professional training and other learning expenses,” said SASRA in its latest soundness report.
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The figures highlight shifting household financial priorities as families contend with the rising costs of education, healthcare and housing while remaining cautious about spending on non-essential items.
Education has emerged as the second-largest reason for borrowing, underscoring the increasing strain school fees are placing on household budgets. As education expenses continue to rise, many families are turning to Saccos for financial support.
Parents are increasingly opting for Saccos because they offer more affordable interest rates and flexible repayment plans than commercial banks.
These arrangements enable borrowers to spread education expenses over an extended period, easing financial pressure and helping households manage their cash flow more effectively.
By Frank Mugwe
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