Savings and credit co-operative societies (Saccos) must comply with new regulations by June 30.
The Sacco Societies Regulatory Authority (Sasra) has ruled out an extension for compliance to the Sacco Societies (Non-Deposit-Taking Business) Regulations, 2020, saying the societies had over a year to prepare for the rules.
It warned the public against dealing with any Sacco that will not have complied by the set date.
“Any person, including members of the public and public entities who undertake such specified non-deposit-taking business transactions or other businesses with an unauthorised person, entity, or Sacco society shall be doing so at his or her risk and peril,” said Sasra Acting chief executive Peter Njuguna in a statement yesterday.
The regulations not only affect Saccos with physical offices but also those that conduct their businesses virtually.
This includes organisations that mobilise members through subscriptions and those that take share capital from persons who are not resident in Kenya.
The main aim of the regulations is to protect members’ savings following cases of Saccos going under with millions of shillings and leaving members penniless.
Sasra said many Kenyans have lost their money to pyramid scheme-like entities operating virtually and purporting to be Saccos by hoodwinking the public to save with them with promises of good returns, only to disappear.
“The new regulations will thus rein in such dubious entities,” Njuguna said.
These regulations target as well Non-withdrawable Deposit Saccos, where members get their deposits back after leaving the Sacco but can use them as collateral for loans during the period of membership.
Graham Kajilwa
