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State plans to invest in upskilling Sacco leaders after Kuscco cash scam

State plans to invest in upskilling Sacco leaders after Kuscco cash scam
CS Wycliffe Oparanya speaking on Wednesday November 20, 2024. PHOTO/@DrOparanya/X

The government is taking steps to upskill leaders in the Sacco industry as part of efforts to restore confidence and stability following the Kenya Union of Savings and Credit Cooperatives (Kuscco) debacle.

This has seen the Ministry of Co-operatives and Micro, Small and Medium Enterprises Development prioritise improved governance to prevent similar crises in the future.

Speaking at the National Cooperatives Leaders’ Summit 2025 organised by CIC Group, Cabinet Secretary Wycliffe Oparanya emphasised the need for cooperative entrepreneurship, stronger governance, risk management, and digital transformation as key pillars for the sector’s sustainability and growth.

Financial inclusion

He said cooperatives are essential for financial inclusion, offering services to millions who are often excluded from the formal financial system.

In response to the issues surrounding Kuscco, the ministry has scaled back the union’s role to its original mandate of oversight and advocacy, after missteps in expanding its operations.

The Sacco Liquidity Fund (SLF) has also been repositioned under the Sacco Societies Regulatory Authority (Sasra), replacing the Central Finance Fund, to ensure proper oversight and management of Sacco funds. Training and sensitisation of Sacco leaders are seen as critical to the success of these reforms.

“These reforms are geared toward strengthening the cooperative financial sector, safeguarding deposits, and reducing the risk of government bailouts,” Oparanya said at a recent briefing on the industry.

Saccos play a significant role in Kenya’s economy, particularly in rural and underserved areas, by offering credit, savings, and investment opportunities. Nationally, cooperatives boast over 14 million members, manage assets exceeding Sh1 trillion, and contribute roughly 30 per cent of national savings.

Patrick Nyaga, Group Managing Director and CEO of CIC Insurance Group, highlighted the importance of capacity building in supporting Sacco growth. “As we mark the International Year of Cooperatives in 2025, we are committed to supporting cooperatives not just through financial solutions, but by empowering them with skills and tools for resilience,” he said.

The summit, themed “Promoting Sustainable Cooperative Enterprises,” attracted stakeholders, policymakers, and cooperative leaders to deliberate on the new Cooperatives Bill and tackle challenges facing the sector. So far, over 250 out of a projected 5,000 cooperative leaders have already benefited from the training initiative.

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