The Kenyan government is set to implement significant changes in the leadership of Savings and Credit Cooperative Societies (SACCOs) as dormant accounts reach a staggering 1.45 million, an 18.6% increase from last year.

The rise in inactive memberships reflects deepening economic struggles faced by many Kenyans, prompting urgent reforms.

Cabinet Secretary for Cooperatives and MSMEs, Wycliffe Oparanya, disclosed plans to introduce term limits for SACCO leaders, some of whom have held office for over three decades. “Some have been in office for as long as 30 years… This cannot continue,” Oparanya remarked, emphasizing the need for new perspectives in leadership.

The proposed Cooperative Societies Bill of 2024 aims to address governance issues and clarify roles within cooperatives. It will outline the responsibilities of members and management while setting clear eligibility and duration limits for positions.

As the number of dormant accounts swells, with 226,893 members halting contributions last year, concerns are mounting over the sustainability of these vital financial institutions.

Evidence from the SACCO Societies Regulatory Authority (Sasra) indicates that the rate of new member recruitment is failing to keep pace with the increasing number of dormant accounts.

“The rate at which regulated SACCOs are recruiting new members remains slower than the rate at which existing members are becoming dormant,” Sasra stated. To combat these challenges, SACCOs are being urged to innovate savings and credit products while focusing on reactivating dormant