Co-operatives and MSMEs Development Cabinet Secretary Wycliffe Oparanya has revealed that 85 regulated SACCOs were owed a total of Ksh 3.49 billion as of December 2024.
Speaking on Wednesday, September 25, during the launch of the SACCO Supervision Report 2024, Oparanya said this represented a marked increase in non-remitted funds compared to 2023.
In 2023, the amount stood at Ksh 2.59 billion, affecting 82 regulated SACCOs and 57,721 members.
The report indicates that in 2024, the largest portion of unremitted funds originated from deductions intended for loan repayments and other credit facilities.
85 Regulated SACCOs Owed Ksh3.49 Billion, Affecting 55,603 Members
Loan repayment deductions increased to Ksh 2.599 billion, accounting for 74.5% of the total unremitted funds. This was up from Ksh 1.68 billion (64.88%) reported in 2023.
Meanwhile, deductions on account of Back Office (BOSA) recorded a slight decrease, standing at Ksh 0.89 billion (25.5%) in 2024, compared to Ksh 0.91 billion in 2023. The report questioned why some employer institutions deduct funds but only remit a portion to the beneficiary SACCOs.
The worst-hit SACCOs were those drawing membership from county governments and assemblies, which owed Ksh 1.69 billion (46.7%).
They were followed by public universities and tertiary colleges, which owed Ksh 762.27 million (21.85%), and state corporations.
Public sector companies (most of which are owned by county governments) owed Ksh 265.77 million, representing 7.62% of the total non-remitted funds, while State corporations and parastatals owed Ksh 164.76 million, representing 4.72% of the total non-remitted funds.
National government ministries and related agencies owed Ksh 129.72 million, representing about 3.72% of the total non-remitted funds.
Although the number of individual members affected decreased slightly, the number of SACCOs involved increased.
The aggregate amount owed also increased significantly, affecting the financial performance and stability of the SACCOs.
Distribution of Non-Remitted Funds Owed by Employer-Institutions in 2024
| Employer Category | No. of Members Affected | Loan Repayments (Ksh) | BOSA Deductions (Ksh) | Total Non-Remitted Funds (Ksh) |
|---|---|---|---|---|
| County Governments & Assemblies | 32,573 | 1,341,624,905 | 265,534,570 | 1,607,159,475 |
| Public Universities & Tertiary Colleges | 6,837 | 295,753,865 | 466,518,737 | 762,272,603 |
| Private Sector Companies | 3,770 | 363,437,670 | 70,435,311 | 433,872,981 |
| State Corporations | 2,226 | 143,749,438 | 21,012,580 | 164,762,018 |
| Public Sector Companies (incl. Water Companies) | 4,108 | 241,357,469 | 24,407,884 | 265,765,352 |
| National Government Ministries | 3,783 | 108,310,964 | 21,404,208 | 129,715,172 |
| Constitutional Organs (Bodies) | 512 | 4,766,375 | 1,997,450 | 6,763,825 |
| Churches & Church-Based Institutions | 325 | 14,369,268 | 3,950,020 | 18,319,288 |
| Public Schools’ Employees (BOM) | 338 | 15,133,446 | 1,013,929 | 16,147,374 |
| Private Universities | 398 | 4,388,953 | 1,488,881 | 5,877,834 |
| Other Entities | 292 | 19,440,949 | 6,380,872 | 25,821,821 |
| Cooperative Entities | 260 | 33,732,364 | 3,713,401 | 37,445,765 |
| Private Sector Schools’ Employees | 180 | 13,031,111 | 1,609,377 | 14,640,488 |
| Grand Total | 55,602 | 2,599,096,776 | 889,467,220 | 3,488,563,996 |
Also Read: Why Select SACCOs Risk Being Shut Down
SASRA Warns Non-Remittance Crisis Threatens SACCO Stability
The SACCO Societies Regulatory Authority (SASRA) has warned that the non-remittance issue will continue to negatively impact regulated SACCOs in both the short and long term unless it is fully addressed.
The Authority said it is monitoring the situation while proposing legal, policy, and administrative reforms to provide lasting solutions.
“Given that the bulk of the non-remitted funds were owed by the government and government owned institutions, the Authority continues to call for policy reforms to allow the recovery of such sums directly from their exchequer grants at the National Treasury,” read the SASRA report.
“These monies can be easily deducted directly from the exchequer grants due to these governmental entities, instead of following the lengthy and tedious legal recovery proceedings, while the affected SACCOs continue to suffer.”
Also Read: Govt Issues Fresh Directives to SACCOs on Management and Loans
SASRA further warned that the continued failure by employer institutions to promptly remit deductions from employees’ salaries is hampering the liquidity of SACCOs and their ability to issue loans and credit facilities, which is their core business.
On the members’ side, SASRA noted that failure to remit BOSA deductions reduces the loan or credit facility a member qualifies for, while failure to remit loan repayment deductions puts members in conflict with their SACCOs over unsettled debts.
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