The Cabinet Secretary, Ministry of Cooperatives and Micro, Small and Medium Enterprises (MSMEs) Development, Wycliffe Oparanya, has asserted that the government will take ruthless measures to curb financial mismanagement within the Savings and Credit Cooperative Organizations (SACCOs) in the country.
The CS confirmed that the government will streamline operations with the important sector by implementing decisive measures to ensure accountability and integrity in their operations.
Speaking at the 10th Annual Sacco Leaders Convention held at Pride Inn Mombasa, the CS noted that individuals found guilty of misappropriating Sacco members’ funds will face severe legal consequences, reinforcing the commitment to protect members’ investments.
Oparanya highlighted that he recently handed over a forensic audit report on the Kenya Union of Savings and Credit Cooperatives (KUSCCO) to the Inspector General Police, to launch immediate investigations into the alleged financial irregularities.
“Moving forward, similar measures will be taken against any cooperative leaders who misappropriate or mismanage members’ funds—let me be clear, this will no longer be tolerated,” Oparanya cautioned.
The Convention has brought together over 800 leaders representing Kenya’s 13,000 SACCOs, confirming the movement’s commitment to financial inclusion, accountability, and innovation.
Oparanya underlined that the cooperative movement remains a strong pillar of the Kenyan financial sector and a catalyst for economic transformation.
“SACCOs are pivotal in financial inclusion, managing over 1 trillion in deposits, this year’s theme; Pioneering Growth; Empowering SACCOS for a Sustainable Future underscores the imperative of balancing growth with sustainability to ensure long-term service to members,” The CS said.
He added that cooperatives are strategically positioned to enhance financial inclusion bridging segments of society that may otherwise be excluded from common financial services,
Unlike unconventional financial institutions that are largely confined to urban centers, Oparanya noted that SACCOs extended their reach deep into grassroots communities, offering critical financial services to Kenyans living in remote areas.
The CS also called for the need to capitalize on this strategic advantage by expanding their membership base, strengthening networks and enhancing competitiveness.
“For over five decades, KUSCCO has played an instrumental role in the SACCO sector through advocacy, capacity-building, and financial services. In 2024, members made the critical decision to restructure KUSCCO to ensure that it meets its obligations and remains effective in its mandate,” Oparanya said.
He highlighted that the recent challenges at KUSCCO serve as a stark reminder of the importance of robust governance, stringent internal controls, and sound financial management.
He asserted that transparency, accountability, and adherence to good governance must remain at the core pillar of the cooperative movement.
“Let us recommit to ethical leadership, financial prudence, and sustainable growth. The cooperative movement is a formidable force for economic and social transformation, and we must align our efforts with the Bottom-up Economic Transformation Agenda (BETA),” Oparanya concluded.
KUSCCO National Chairman David Mategwa, emphasized on the need by the organization to focus on the new strategic direction after revelations financial misappropriation in the umbrella Sacco body.
Mategwa affirmed that his team was diligent in ensuring that the lessons and insights from the forensic audit are acted upon swiftly and decisively.
He confirmed that the report had been submitted to all relevant authorities including the CS- Cooperatives and MSMEs, Inspector General of Police, Ethics and Anti-Corruption Commission, Office of the Director of Public Prosecutions, the Assets Recovery Agency and the Directorate of Criminal Investigations for the necessary action.
“The recent comprehensive forensic audit that was conducted has provided us with invaluable insights into our operations. This proactive step has illuminated areas for strengthening and improvement, and as your interim board, we embrace these findings as opportunities for growth and enhanced efficiency,” Mategwa said.
By Fatma Said and Nuru Soud
