August 17, 2022

Sacco Review|The Leading Newspaper for Co-operative Movement in Kenya

The Leading Newspaper for Co-operative Movement in Kenya

Reprieve for 11 Saccos as regulator extends licenses


By Jackson Okoth.
The Sacco Societies Regulatory Authority (SASRA) has extended the license of 11 Deposit-Taking Saccos that have failed to meet set prudential guidelines.
The affected Saccos will now be allowed to operate on a temporary license until December this year when the regulator will again review their liquidity, governance and capital adequacy status.
Deposit-Taking Saccos that will remain on the SASRA watchlist and which had their permits expired on 31st July 2017, include COMOCO, Jitegemee, Kenya Midland, Miliki and Moi University Saccos. Other troubled DT Saccos that now operate on a provisional license include Nandi Hekima Sacco, Neco Sacco, Nitunze Sacco, Orient Sacco, Rachuonyo Teachers Sacco, Telepost Sacco and Uchongaji Sacco Society Limited.
The list of Sacco Societies granted restricted deposit-taking license is in accordance with Section 26(3) of the Sacco Societies Act cap 490. Some of the troubled Saccos that have since had their DT licenses restored include Ainabkoi Sacco, Airports
Sacco, Eco-pillar Sacco, Good Faith Sacco and Trans-National Times Sacco Societies Limited.
Those Saccos that have remained under SASRA’s surveillance for the past two years include Comoco Sacco, Telepost Sacco, Nitunze Sacco, Nandi Hekima Sacco and Moi University Sacco Society Limited.
In a notice dated 27th January, 2017 signed by SASRA Chief Executive  Officer, John Mwaka, the regulator revoked the Deposit-Taking license of Banana Hill Sacco Society Limited. It also placed Jijenge Sacco Society Limited under statutory management.
“ Members of the public are advised to desist from undertaking or transacting
deposit-taking Sacco business (FOSA)with any person, institution or entity unless the person, institution or entity is licensed by the Authority as a deposit-taking Sacco Society; and report any such person, institution or entity to SASRA or the nearest Police station for appropriate action,” said Mr Mwaka.
SASRA has until now revoked the Deposit-Taking licenses of Banana Hill Sacco, Bahima Sacco, Transcom Sacco, Ufundi Sacco, Maono Daima Sacco, Greenhills Sacco and Nest Sacco Society Limited. This means that members of these Saccos will not be able to get banking services from their Society i.e. operate savings accounts in which they could deposit or withdraw cash any time with the Sacco.
These Saccos are also not allowed to clear or issue cheques. The affected Saccos are also prohibited from doing salary processing, operating current accounts, automated teller machine (ATM) services, and mobile banking and money transfer services.
Revocation of a license is a big blow to Saccos that have invested heavily in infrastructure, information systems and corporate governance structures so as to be allowed to take deposits from the public.
A total of nine Saccos have had their licenses withdrawn since 2014 and are now supervised by the Commissioner for Co-operative Development. Reprieve for 11 Saccos as regulator extends licenses Jeremy Karemeri Mwangi, Broad Borders Chairman.