Public universities and tertiary colleges owed the largest proportion of non-remitted funds for SACCOs in 2023, a report by Sacco Societies Regulatory Authority (SASRA) has revealed.
According to the Sacco Supervision Annual Report 2023 released this week, the institutions owed Ksh958.07 million which translates to 37 per cent of the total non-remitted funds.
Subsequently, county governments (and Assemblies) owed a sum of Ksh865.12 million (33.41 per cent) while state corporations owed a total of Ksh162.89 million (3.08 per cent).
“It is observable from the market analysis that government and government-related agencies continue to be the greatest defaulters in remitting funds owed to Regulated SACCOs on the pretext of inadequate funding or budgetary allocations,” the report reads in part.
The report pointed out that the institutions being government entities have made recovery of the funds quite difficult based on the prevailing legal and regulatory instruments.
The authority called for a policy shift so that the funds may be deducted at source by the National Treasury from the exchequer grants, appropriated by Parliament, in favour of the defaulting government institutions, and directly remitted to the affected SACCOs.
“This remains the most viable policy solution to this menace, given that employer institutions from the private sector had a relatively low proportion of non-remitted funds,” the report also reads.
SASRA warned that that if the non-remittance continues, it will continue to negatively impact the section of regulated SACCOs which rely on various employer institutions to deduct and remit members deposits and loan repayments.
As of December 2023, monies owed to were at a high of Ksh2.59 billion compared to Ksh2.67 billion in 2022; with a total of 82 regulated SACCOs and 57,721 members affected.
By Vostine Ratemo
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