Kenyans in the diaspora who have been saving their monies with Awe Diaspora Savings and Credit Co-operative Society (Sacco) are staring at huge losses after the government placed the society under liquidation.

The non-withdrawable Sacco allowed members to make a minimum contribution of Sh5,000 monthly designed to be used as collaterals to secure loans or withdrawn upon the attainment of the completion of the savings period or on a request by the member.
Commissioner for Co-operatives development, David Obonyo since the cancellation of the registration of the company took place on August 22 last year, no appeal had been made by the time the liquidation notice was being issued.

“In pursuant of section 65 of said Act, I appoint Susan Ong’ondi,

Assistant Commissioner for Co-operatives Development to be the liquidator for a period not exceeding one year and authorise her to take into her custody all the properties of the said society including such books and documents as one deems necessary for the completion of the liquidation,” he said.

This category of Kenyans has proven to be key players towards the growth and sustainability of the economy through their growing remittances in the country, which recently amounted to $ 427.4 million (Sh55.13 billion) with the cumulative inflows for the 12 months to January 2025 increasing by 16.6 per cent to $ 4,961 million (Sh640.8 billion) compared to $ 4,253 million (Sh548.6 billion) in a similar period in 2024.

The setback instils further fear in the country’s co-operative movement as the industry continues to face head winds.
Currently, Kenya Union of Savings and Credit Co-operatives (Kuscco), the umbrella body for saccos in the country, essentially providing a central financing facility to cover liquidity is facing headwinds, emanating from its previous management.

The organisation also started facing turbulence when its depositors started pulling out their monies from the Central Financing Facility (CFF) between late 2023 and early last year affecting its financial stability. In November last year, an internal audit report revealed that approximately Sh12.5 billion had been lost as a result of “illegal” withdrawals and poor management structures.

The top Union’s officials during the same year had been found to have squandered Sh6.56 billion in the past decade, an occurrence that prompted Kuscco board to be disbanded by the then Cooperatives and Micro, Small and Medium Enterprises (MSMEs) Cabinet Secretary Simon Chelugui.

“Effective immediately, I the CS for cooperatives and MSMEs Development hereby announce the dismissal of the current board of directors. Furthermore, the Commissioner for Cooperatives Development is directed to appoint an interim board of 15 members drawn from esteemed leaders of affiliate cooperatives,” he said.

As a result of the inconveniences, Arnold Munene, the acting Managing Director of Kuscco now wants the government to help salvage the situation saying, “it will be irresponsible for Kuscco which plays a central role in the survival of the sacco industry, to collapse. It is not too late to salvage it.”

According to the Sacco Societies Regulatory Authority (Sasra) Annual Supervision Report 2023, if the union, surviving on a thread, collapses the industry will have dealt a huge blow which might take decades to rise again.