Kenyans pushing SACCOs to lower lending rates to single digits
By Loise Wambugu, January 27, 2026Savings and Credit Cooperative Societies (SACCOs) in the country, which collectively hold over Ksh1.4 trillion in member deposits, have been urged to consider reducing their lending rates to single-digit interest levels in order to improve members’ economic well-being.
Speaking on Monday, January 26, 2026, at the Newsfortis SACCO 50th Annual General Meeting held in Nyeri, Cooperatives Principal Secretary (PS) Patrick Kilemi said the leadership should engage and agree on lowering interest rates from as high as 12 per cent to single digits to foster economic growth among members.
“As a government, we are aware that our Saccos can sit down and lower these rates to single digits. In government, we are sourcing funds from the World Bank and lending at single-digit interest. We can replicate the same model in Saccos as we steer our economy in the Singapore way,” Kilemi said.
The PS noted that lower lending rates would translate into significant economic gains for the county and the country at large.
On his part, Nyeri governor Mutahi Kahiga supported the proposal but cautioned that a reduction in lending rates would inevitably affect dividends paid to members.
“It is possible to lower lending rates, but members should also brace for lower dividend rates since Sacco profits will go down,” Kahiga said.
Moreover, Newfortis SACCO Chairman John Githinji echoed the governor’s sentiments, saying that while lowering lending rates was achievable with proper structures in place, members would have to agree to reduced dividends.
“We can be able to lower lending rates, but the government must institute proper procedures for this to happen. However, I must warn members that their dividend rates will shrink,” he said.
“Today, we have paid dividends at 14 per cent, amounting to over one billion shillings to more than 24,000 members.”
The leaders agreed that any reforms must balance affordable credit with the sustainability of Saccos and the expectations of their members.
Meanwhile, the government has announced reforms to restore stability and safeguard member savings in the SACCO sector.
This comes even as the stakeholders continue to decry the loss of Ksh13 billion by the Kenya Union of Savings and Credit Co-operatives (KUSCCO), and Metropolitan SACCO members lose Ksh7 billion.