Page 33 - Issue 48_press_efile

POLICY AND REGULATIONS
“Enhancing the mandatory role of SASRA will in the long run
fill gaps the SACCOs sub sector is grappling with, for example,
poor governance, corruption and resources misallocation.
There is need to reinforce governing system to ensure the
financial business within the movement is well undertaken to
reach out to all interested members but are not able to as the
services are far,” says Mr. Marube.
Equally, he adds, strengthening of SASRA will help in ensuring
uniformity in SACCO business and shield members against
fraud incidences and general loss of their deposits.
SACCOs have played key role in enhancing savings and
financial inclusion in the market as espoused in the Vision
2030 economic blueprint.
Marube states that toughening of the monitoring administration The draft Co-operative Development Policy is currently being
will promote financial deepening in the SACCO sub sector.
“Doing so is expected to enhance members’ confidence in Co-
operative financial business as well as attracting more potential entities operating BOSA under SASRA and the non-financial
members to join the Credit Unions. Equally, strong regulatory
establishment will make the SACCOs more vibrant and ensure
continuity, “states Marube.
According to 2016 World Bank report - Kenya Country Economic
Memorandum; From Economic Growth to Jobs and Shared
Prosperity - Kenya’s financial sector has witnessed rapid
development over the past years, with the share of population
with access to finance increasing from 69 to 75 percent.
Commercial and microfinance banks control more than 50 per
cent of the total savings in the country.
During the 97th (Ushirika day) International Co-operative
Day, President Uhuru Kenyatta noted that Kenya has over
23,000 registered Co-operative Societies and commands a
membership of over 14 million people.
Cabinet Secretary, Trade, Industry and Co-operatives Peter
Munya in a recent interview said lack of strong regulations to
manage the SACCOs that are not controlled by SASRA has led
to high cases of racket leading to majority of members losing
their deposits.
He said the Co-operative Act Cap 490 has gaps that have
created leeway for leaders to swindle Kenyans their hard-
earned sweat.
The Non-DTS are part of thousands of Co-operatives that for
years have not been filing returns annually to the commissioner
for Co-operatives making it hard for the Government to
intervene in case an institutional collapse.
“Most of these institutions are being managed like pyramid
schemes and cartel like and are not licensed. The core activity
of receiving deposits and offering loans to the same members
have been completely diluted as the directors and managers
place the investors’ money to activities that suit only their
interests,” the minister added.
National Housing and Cooperative Union (NACHU) chairman
Francis Kamande says that over and above enhancing the
capacity role of SASRA, there is need to support the office of
the Commissioner for Co-operatives to enable it offer sound
direction in the movement.
“Over the years, new realities have emerged, for instance,
County Governments, urbanization and emergence of new
economic sectors thus triggering new thinking in terms of
review of the current legislation governing the movement,”
said Kamande.
validated by county governments and other stakeholders.
Once enacted, the policy will bring the financial Co-operative
under Co-operative Regulatory Authority for better monitoring
and supervision.
Over 5,000 SACCOs that operate BOSA are spread in the counties
and supervised by the Commissioner for Co-operatives.
operative principles and values as a way of safeguarding while
ensuring that the interests of the general membership are
safeguarded,” says Peter Munya, Ministry of Industry, Trade and
Co-operatives Cabinet Secretary.
Munya adds that these regulations, once in place, “will provide
a framework for mobilizing financial and technical assistance
for Co-operative development, encouraging Public Private
Partnerships (PPPs) in the area of value-addition, marketing
of Co-operative goods and services; and the promotion of Co-
operative education, training and research.”
“The objective of this policy is to promote sustainable and
competitive Co-operative Societies for an enhanced role in
industrialization and improved social economic development,”
the policy document reads in part.
Currently, the Co-operatives draw regulations from The Co-
operatives Societies Act Cap 490, The Co-operatives Societies
Rules 2008, The SACCO Societies Act 2008 and The SACCO
Societies Regulations 2010.
Commercial and microfinance banks
control more than 50 per cent of the
total savings in the country.
31| SACCO Star Magazine