Draft a national policy to regulate saccos, alliance says

In Summary

•This action will weed out pyramid-like entities masquerading as co-operatives, fleecing Kenyans

•We need a national cooperative policy and a legal framework to seal these loopholes

Cooperatives Alliance of Kenya Chairman Daniel Marube. /FILE
Cooperatives Alliance of Kenya Chairman Daniel Marube. /FILE

The cooperative movement has asked for an audit of Savings and Credit Co-Operative Societies operating in counties to weed out pyramid-like entities masquerading as cooperatives.

Cooperative Alliance of Kenya chief executive officer Daniel Marube said the constitution shifted supervision of cooperatives and Saccos to counties after functions were devolved from national government through commissioner of cooperatives. This has left a loophole that is being exploited to fleece public of their savings.

The counties are ill prepared to supervise and audit co-operatives as they have no staff with requisite technical skills to supervise and audit the cooperatives.

Where they exist, the departments are not well funded.

“We need a national cooperative policy and a legal framework to seal these loopholes,” he said.

Stephen Otieno, CAK chief operating officer said there is a task force working on how to bring the financial cooperative entities operating back-office activities under Sacco Societies Regulatory Authority and Cooperative Regulatory Authority for better monitoring and supervision.

“ Some of these organisations are managed by individuals while others are subsidiaries of big organisations,” said Marube.    

Only 174 Saccos are under the control of Sasra established in 2008.  Over 5,000 Saccos are in counties and supervised by the commissioner for Cooperatives.

“The promulgation of the constitution of Kenya 2010 was meant to bring good tidings to the co-operative sector, but it is not so,” he said.  The constitution assigned all duties to counties which by then had not established legal structures. This he said rendered the office of the commissioner for cooperative development (CCD) redundant.

Marube said he lost control of field officers and disconnected with the field. “What played out through Ekeza Sacco succinctly reflects a picture of an office of the CCD that has no capacity to feel, see, hear or for that   matter act on any vice visited upon the co-operative movement,” he said. The office of the commissioner lacks the stamina to supervise the entire cooperative movement as the current legislations are not in tandem with the current realities in the movement.  Activities such as inquiries, deregistration of errant cooperative societies are only effected after damage has been done.