Counties

Ministry warns saccos against fleecing members

sacco

County CEC (left) and Stima Sacco National Treasurer John Mudany during the official launch of the Mombasa Stima Sacco office on August 24, 2018. PHOTO | WACHIRA MWANGI | NMG

Savings and credit co-operative organisations (Saccos) that solicit for money and fleece members will be deregistered, Commissioner for Co-operative Development Mary Mungai has warned.

Representing Trade Cabinet Secretary Peter Munya at 2nd Stima Sacco Delegates Congress at Sarova Whitesands Beach Resort in Mombasa on Monday, Ms Mungai said such saccos "are bad apples that will be uprooted."

“The governance in cooperatives admittedly is good but we also have bad apples. We are trying to clean up, especially the saccos that are purporting to be saccos but their principles are not pegged on cooperative principles.

There are people who come and register and go out to solicit money from members without proper structures. We are actually deregistering them and weeding them out,” the commissioner said.

Report saccos

She also asked members to report saccos that were badly managed.

She said the ministry has structures to secure members’ money and laws that govern the saccos.

“Saccos are structured, genuine and Kenyans need to know what Saccos they are getting registered to. Kenyans need to understand sacco models that will be of help, do due diligence.

"What is bedevilling our members is they just hear of saccos over the radio and they join but later they come crying foul,” Ms Mungai added.

She lauded Stima Sacco as one of the big saccos with more than 120,000 members countrywide and with a "very impactful footprint."

Self-help

“Cooperative movement is based on principles and values like self-help. Members must own the business model, be principled, responsible, democratic, exercise equality, ethical and have solidarity,” she said.

She called on the Sacco fraternity to have a business model members can own.

“A sustainable movement is where members own a business model and that is what Stima Sacco and all the other Saccos are playing. We want sustainability in the financial space,” she added.