The Sacco Societies Regulatory Authority (SASRA) has reported that Kenyans cashed out Ksh30.8 billion of the money saved in Saccos in 2022.
“This can be attributed to the high cost of living, which has resulted in members withdrawing their savings for consumption purposes,” said the report.
The latest supervisory report also showed that withdrawable deposits fell by 26.9 per cent to Ksh83.78 billion from Ksh114.59 billion.
“The harsh macroeconomic conditions that prevailed for most of 2022 resulted in a significant reduction in disposable income for majority of Sacco members,” the report continues.
In addition, Sacco savers withdrew Ksh10.46 billion the previous year thus reducing Front Office Service Activity (FOSA) savings in Saccos supervised by SASRA from Ksh12.05 billion.
Fixed deposit savings also fell by Ksh1.31 billion from Ksh22.33 billion to Ksh21.02 billion during the period.
SASRA Chairman Jack Ranguma said that the elevated inflation is likely to reduce the savings ability of members thereby undermining the ability of Saccos to mobilize savings.
The decline in withdrawable and fixed deposit savings also saw the number of dormant members in Saccos rise from 1.18 million to 1.22 million.
The consecutive decline in voluntary savings contrasts with 2020, when such savings increased by 85.3 per cent to peak at Ksh125.5 billion.
Overall, total savings in SASRA-regulated Saccos grew 9.84 per cent to Ksh620.45 billion at the end of last year from Ksh564.89 billion a year later.
The growth in deposits was supported by non-withdrawable deposits, which grew by 20.5 per cent to Ksh515.65 billion, accounting for 83 per cent of total deposits.
“The increase in Back Office Services Activities (BOSA) savings can be explained by the fact that they are mandatory in nature while FOSA savings are voluntary and easily accessible by members in case of need,” said SASRA.
By Thuita Jaswant
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