SACCOs Face Government Scrutiny

The government has introduced tough new rules for SACCOs after uncovering financial mismanagement at the Kenya Union of Savings and Credit Co-operatives (KUSCCO).

Commissioner of Cooperatives David K. K. Obonyo revealed that KUSCCO declared profits and dividends even when it was making losses. To stop such practices, the Ministry has set strict guidelines to ensure SACCOs report their financial status honestly and only pay dividends based on real profits.

They will also be limited in how they invest, with a focus on their main role of savings and loans. Those wanting to invest in areas like housing must now create separate companies for such projects.

The changes aim to bring order to the SACCO sector, protect members' savings, and prevent further financial scandals.