Summary of the Sacco Societies (Amendment) Bill, 2025, which was read a first time in the National Assembly this week:
— Establishes a central liquidity and shared services framework, allowing 30 primary Saccos to form a secondary Sacco that pools funds, manages liquidity, and provides system-wide financial infrastructure, including payments and settlement.
— Defines a wholesale-only model for the secondary Sacco, which means it cannot take deposits from or lend to individuals, restricting operations strictly to primary Saccos and creating a clear two-tier system (members → primary Saccos → secondary Sacco).
— Expands permissible activities of the secondary Sacco to include liquidity reserve management, inter-Sacco lending, investment in government securities, payment systems, transfers, and trade finance, positioning it as a sector-wide financial intermediary.
— Places the secondary Sacco under SASRA licensing and supervision, with prescribed capital and liquidity thresholds, continuous oversight, and regulatory enforcement powers.
— Introduces stricter governance and fit-and-proper requirements for directors and senior management of the secondary Sacco, alongside expanded regulatory approval powers.
— Strengthens enforcement through penalties for non-compliance, including fines of up to KES 3M or imprisonment of up to 5 years.
— Enhances the Deposit Guarantee Fund framework for primary Saccos, outlining claims processes, payout conditions, and timelines in the event of Sacco failure.
— Maintains depositor protection at KES 100,000 per member in primary Saccos, with provisions allowing offsets against outstanding loans before payouts.
— Grants the Cabinet Secretary and regulator powers to set regulations, fees, liquidity thresholds, and operational rules, with the Bill classified as a money bill due to public expenditure implications.
Link to the Bill:
parliament.go.ke/sites/defau…