NAIROBI, Kenya, Apr 8 – Kenya Union of Savings and Credit Co-operatives Limited is facing a fresh insolvency petition, deepening concerns over governance and financial stability within the SACCO sector.
A petition filed at the High Court’s Commercial and Tax Division on March 17 seeks the compulsory winding-up of the umbrella body, citing its failure to settle debts amounting to Sh108.8 million within the required timeframe.
The court has issued preservatory orders barring the disposal or transfer of KUSCCO’s assets pending determination of the case, effectively freezing key operations.
“The company is unable to pay its debts as they fall due within the meaning of the Insolvency Act,” the court filing states, warning that any disposal of assets without court approval may be void.
The latest development follows a Sh17 billion financial scandal that rocked KUSCCO last year, involving alleged fraud, irregular transactions, and diversion of funds by top officials.
A government-backed forensic audit in 2025 uncovered weak internal controls, including approval of large transactions without proper oversight, issuance of unsecured loans, and unreliable financial records.
The findings raised questions about the institution’s true financial position and exposed systemic governance failures within the cooperative body.
The insolvency case now adds to mounting pressure on KUSCCO, with the outcome likely to have wider implications for the SACCO sector and confidence in cooperative financial institutions.
