The government has suspended the registration of new Savings and Credit Cooperatives (SACCOs) for a period of three months, in a move aimed at reinforcing governance standards and curbing rogue operations in the cooperative sector.
Announcing the suspension on Wednesday, Cooperatives Cabinet Secretary Wycliffe Oparanya said the decision is part of a broader reform agenda targeting policy compliance and structural governance in SACCOs. The measure, he noted, will provide space for a newly formed committee of experts to finalise a comprehensive review of regulatory frameworks governing the sector.
“We have suspended the registration of new SACCOs for three months. The suspension will allow a committee of experts to finalise its review of governance and policy alignment,” said Oparanya during the inauguration of the Transition Board of Directors of the Kenya Union of Savings and Credit Co-operatives (KUSCCO).
Oparanya cited the proliferation of “briefcase SACCOs” unregulated and often fraudulent entities as a major concern, warning that such operations erode public trust and pose risks to financial stability. The suspension, he said, is a proactive step to weed out illegitimate players and ensure that only credible SACCOs operate within the legal framework.
The ministry also unveiled a five-member committee of experts tasked with reviewing the SACCO Societies Act, 2008. Their mandate includes proposing legal and institutional reforms to align the regulatory environment with emerging trends and international best practices.
In addition, the CS presided over the appointment of a new Transition Board of Directors for KUSCCO, which will serve a two-year term. The board was appointed by the Commissioner for Cooperatives as part of the wider restructuring process within the cooperative movement.
Oparanya expressed optimism that both the expert committee and the new KUSCCO board will play vital roles in strengthening SACCO resilience, promoting transparency, and driving meaningful sectoral reforms.
This latest development reflects the government’s renewed commitment to stabilising and professionalising Kenya’s cooperative sector, a key pillar in advancing financial inclusion and empowering grassroots economic development.
