KENYA'S cooperative movement is one of the country's greatest economic success stories, mobilising more than Sh1.2 trillion in assets while providing affordable credit and financial inclusion to millions of households and businesses.
The ongoing debate over the Cooperatives Bill and the Sacco Societies (Amendment) Bill should therefore focus on strengthening the sector, not spreading unfounded fears about members' savings.
The greatest challenge facing Saccos today is governance rather than growth.
Cases of fraud, weak internal controls, poor risk management and slow adoption of technology have exposed gaps that must be addressed to protect members' interests.
The proposed reforms provide an opportunity to strengthen oversight, improve accountability of elected leaders and promote professional management across the sector.
Equally important is modernising regulation to match today's digital financial landscape.
As saccos expand mobile banking and digital lending, stronger cybersecurity, data protection and risk management systems are essential to safeguard members' funds and maintain public confidence.
The proposed Deposit Guarantee Fund is another positive step. Just as bank deposits are protected, a dedicated guarantee scheme would enhance confidence in saccos by providing an additional layer of protection for members' savings without interfering with their ownership.
The reforms also encourage continuous training for directors, stricter governance standards, stronger internal audits and greater financial transparency.
At the same time, embracing technology will improve efficiency, reduce operating costs and enable saccos to better compete with banks and fintech firms while preserving their member-owned identity.
It is equally important to reassure members that the proposed laws do not give the government access to Sacco deposits.
Members' savings remain the property of individual saccos and continue to be managed by officials elected by members. Investment decisions remain the sole responsibility of each sacco, guided by policies approved by members.
With more than 14 million cooperative members, Kenya has an opportunity to use these reforms to build a stronger, more transparent, digitally driven and resilient cooperative movement that will continue driving financial inclusion and grassroots economic growth for decades to come.
Kilemi is the PS for Cooperatives in the Ministry of Co-operatives and MSMEs Development
