By Benadeta Mwaura - Reporter
Kenya, July 14, 2026 - Kenya's Savings and Credit Cooperative Organisations (SACCOs) have moved to reassure millions of members that their savings remain under the control of individual cooperatives, dismissing claims that the government can dictate how the funds are invested or access the sector's estimated KSh1.2 trillion in assets.
The clarification follows growing public concern over the proposed SACCO Societies (Amendment) Bill, 2025, and speculation that SACCO deposits could be channelled into government infrastructure projects through the planned National Infrastructure Fund. Industry leaders insist the debate has been fuelled by misconceptions about both the ownership of SACCO funds and the composition of the sector's balance sheet.
Speaking on behalf of the cooperative movement, Mwalimu National DT SACCO Chief Executive Officer Kenneth Odhiambo said the law does not permit the government to interfere with how cooperatives invest members' money.
"The government cannot dictate how SACCOs invest members' funds. The Co-operative Societies Act protects that autonomy. No argument there."
Odhiambo explained that SACCOs are autonomous, member-owned institutions governed by elected boards, meaning investment decisions remain the responsibility of members and their leadership rather than the State. While regulatory reforms may strengthen governance and oversight, they do not transfer ownership or control of members' savings to the government.
The SACCO movement also sought to dispel another widespread misconception—that the sector is holding KSh1.2 trillion in idle cash that could easily be redirected to finance public projects.
According to industry officials, the KSh1.2 trillion represents the total value of SACCO assets, the largest component of which consists of loans already advanced to members, alongside investments, buildings, equipment and other financial assets. It is therefore inaccurate to equate the figure with cash available for immediate investment.
Officials explained that SACCOs operate by mobilising deposits from members and lending those funds back to members to finance businesses, education, home ownership, farming and other personal investments. Once disbursed, the loans become assets on the SACCO's balance sheet because they are expected to be repaid over time.
The clarification comes as the government continues to defend reforms intended to modernise the cooperative sector while denying reports that it plans to tap members' deposits for infrastructure financing.
State Department for Cooperatives Principal Secretary Patrick Kilemi recently sought to reassure Kenyans that SACCO deposits remain protected under the cooperative model.
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"SACCO funds remain the property of the respective SACCOs and are managed exclusively by the elected officials. The government of Kenya has no access to, nor does it intend to utilise these funds."
He added that member deposits held in SACCOs, since cooperatives are autonomous, they are member-owned institutions and their funds are strictly used to provide affordable credit and other financial services to their members.
The assurances follow heightened public anxiety after discussions around the proposed National Infrastructure Fund sparked speculation that cooperative savings could be used to finance government projects.
Treasury and cooperative officials have consistently denied the claims, maintaining that any investment decisions remain with individual SACCOs and their members.
Kenya's cooperative movement remains one of the country's largest financial ecosystems, serving millions of members ranging from teachers, police officers and civil servants to farmers, small businesses and informal sector workers. Beyond providing affordable credit, SACCOs have become a key pillar of financial inclusion by enabling members to save, invest and access financing that is often more flexible than conventional bank lending.
As Parliament considers reforms to the cooperative legal framework, sector leaders are urging Kenyans to distinguish between assets, deposits and liquid cash, arguing that misunderstanding these concepts risks creating unnecessary alarm among members.
They maintain that while regulatory reforms may strengthen governance, payment systems and investment opportunities within the cooperative sector, the fundamental principle remains unchanged: SACCO savings belong to members, and decisions on how those resources are invested continue to rest with the cooperatives themselves under existing cooperative laws.