NAIROBI, Kenya, May 22 – The management of local Savings and Credit Co-operatives (Saccos) have been urged to ensure that their institutions are financially sound and professionally run.
Newly appointed Sacco Societies Regulatory Authority Chief Executive Officer Carilus Ademba said the regulator is now in place and would be keenly monitoring the operations of the sub-sector in an effort to safeguard the billions of shillings in investor funds.
“The Kenya Union of Savings and Credit Cooperative Society (KUSCCO) must be strong in the face of a regulator. This is because there are a number of activities that we have lined up but as the regulator, we are not going to implement them alone. We will pass them back to KUSCCO,” he said.
The Regulatory Authority which was established by the Sacco Societies Act, 2008 with a view to license, regulate and monitor the operations of the deposit taking Saccos, became operational a few weeks ago and is expected to be enhanced by regulations which should be gazetted in the next one week.
The Act was assented to in December 2008 but has not been operationalised until the beginning of this month when the CEO took office.
The sub-sector, which boasts Sh180 billion in savings and Sh200 billion in asset base, has been unregulated until now, a situation that saw many people join ‘get rich quick’ schemes in their thousands but also lost billions of shillings in the process.
He said he had already recruited five senior managers and expressed confidence that close to 90 staff would be employed before the end of the year.
Mr Ademba who is the immediate former CEO of KUSCCO also cautioned the Saccos against expecting favours as the regulator would ensure that the laws are followed to the letter.
“The regulator is not going to shut the door to any Sacco; we simply want to restore good governance so that we can benchmark ourselves with the best in the world,” he said.
As the authority – which will be overseeing operations of 4,000 Saccos across the country – moves to implement the law and the regulations, the CEO called on the members to raise any concerns they have regarding the new law so as to enhance its effective implementation.
“There are transitional issues within this law but where you feel it is too strong, you’ll need to raise it up with us. But we are going to work hand-in-hand to ensure we move very smoothly,” he assured.
A department has already been created within the umbrella organisation, KUSCCO to assist its members meet the requirements outlined in the Act and ensure the smooth implementation of the law.
Mr Ademba spoke during the Annual Delegates Meeting which was also attended by Cooperatives Assistant Minister Linah Jebii Kilimo who read a speech on behalf of her minister Joe Nyagah.
In the speech, the minister pledged to continue playing a facilitative role to ensure that the cooperative sector is globally competitive.
Kenya’s movement is rated first in Africa and seventh world wide but the government challenged it to execute strategies that would see it ranked fifth globally in the next four years.