Cooperative Alliance of Kenya Dismisses Claims Government Wants to Use SACCO Savings to Finance Infrastructure Projects

By Gedion Nzyoki -

NAIROBI, Kenya, July 10, 2026 — The Cooperative Alliance of Kenya (CAK) has dismissed as false and misleading claims that the government plans to use members' savings held in Savings and Credit Cooperative Organizations (SACCOs) to finance long-term infrastructure projects.

From right: Cooperative Alliance of Kenya (CAK) CEO Daniel Marube, KUSCCO Group CEO Arnold Munene, and Jacob of Paresha SACCO during a press briefing in Nairobi on Friday. Photo: Courtesy.

Speaking during a press briefing in Nairobi on Friday, CAK Chief Executive Officer Daniel Marube assured millions of cooperative members that neither the Cooperative Societies Bill nor the SACCO Societies (Amendment) Bill contains any provision allowing the government to access members' savings for infrastructure financing.

Marube said the reports circulating on mainstream and social media had unnecessarily caused panic among SACCO members, insisting that the allegations had no legal basis.

"We wish to categorically state that these claims are false, misleading and have no basis in law," Marube said.

He added that the information being shared online had created unnecessary anxiety among members and urged the public to ignore and stop circulating it.

"There is nothing like that in the Bill that is being discussed in Parliament on the SACCO Societies Bill. There is nowhere showing or providing evidence that the government intends to take money from the movement for infrastructure funding," he said.

Marube explained that the cooperative movement had actively participated in the drafting and review of both the Cooperative Societies Bill and the SACCO Societies (Amendment) Bill through memoranda and public participation.

According to him, the Cooperative Societies Bill has undergone nearly 14 years of consultations and is currently at the mediation stage before being assented into law.

On the SACCO Societies (Amendment) Bill, Marube said the current version before Parliament is significantly different from the original proposal after stakeholders submitted extensive recommendations to Members of Parliament.

He noted that members who were yet to submit their views would have another opportunity during Senate public participation.

Proposed unions aimed at efficiency

Marube clarified that one of the major proposals in the amendment Bill is the creation of cooperative unions to improve efficiency, lower operational costs and enable shared services among SACCOs and other cooperatives.

He dismissed claims that the proposed "Super SACCO" would pool members' savings under government control.

"It is what we are talking about as the super SACCO. It's not anything else other than being a union of SACCOs coming together so that they can take advantage of being in a group," he explained.

He said the unions would allow SACCOs operating within the same value chains to share services such as legal support, auditing and technology instead of each institution investing separately.

The CAK CEO added that sector-based federations for dairy, coffee, Jua Kali and other cooperative societies would also strengthen advocacy and improve economies of scale.

Marube further said the unions would enable inter-lending between SACCOs, allowing institutions facing temporary liquidity challenges to borrow from fellow SACCOs instead of relying on commercial banks.

"At the moment, we are borrowing from commercial banks between 18 and 22 percent interest rate. We are saying we can pool our resources together," he said.

Marube Deposit Guarantee Fund

Marube also defended proposals to establish a SACCO Deposit Guarantee Fund, saying it is designed to protect members' savings if a SACCO collapses.

He noted that while commercial banks are protected under the Kenya Deposit Guarantee Fund, cooperative members currently risk losing everything whenever a SACCO fails.

"We are protecting our members by bringing up a SACCO Deposit Guarantee Fund," he said.

According to Marube, the fund would operate as an insurance mechanism within the cooperative ecosystem to cushion members against losses.

Addressing concerns that the government could compel SACCOs to invest in infrastructure bonds, Marube maintained that all investment decisions remain the exclusive responsibility of members through Annual General Meetings (AGMs).

"The authority, the governing power of the cooperatives is held by the members, and the decisions are being made through the AGMs," he said.

"If a SACCO wants to put their money in long-term infrastructure bond, the leadership will go back to the AGM, bring the reason, and it will be voted by members."

He stressed that the government has no legal powers under the proposed legislation to force cooperatives or SACCO unions to invest members' funds in infrastructure projects.

"There is nowhere in this Bill that the government will force the unions to put the money into infrastructure."

Marube acknowledged that SACCOs currently invest in short-term government securities such as 90-day Treasury Bills but said they deliberately avoid locking members' money into long-term investments because the funds are primarily meant to finance affordable loans.

"If we collect the money and put it in long-term investment, we will deny our members the loans that they need. And that is our purpose."

Calls to stop spreading misinformation

Marube said both the National Treasury and the Ministry of Cooperatives had already publicly dismissed claims that the government intends to interfere with the cooperative sector.

He emphasized that cooperatives are privately owned organizations governed by their own bylaws, with government only providing the legal and regulatory framework.

"Cooperatives is a private activity. We are not a government. We are not a parastatal. We are not managed by government."

He urged members to refrain from sharing unverified information that could undermine confidence in the sector.

"I want to urge my members in the cooperative movement not to continue circulating this kind of misleading information... because they are false and they are misleading."

Assets are loans, not idle cash

Marube also addressed claims regarding the cooperative sector's asset base, currently estimated at more than KSh1.3 trillion.

He clarified that the figure represents loans already advanced to members rather than cash sitting in bank accounts.

"The 1.3 trillion is in houses. It is in the cars. It is in the businesses. It is in the land. The money is in the loans."

He explained that SACCO members save money primarily to access affordable credit, with institutions often lending up to three times members' savings.

"There is no KSh1.3 trillion sitting anywhere idle," Marube said, adding that any investment decisions involving cooperative funds can only be approved by members during Annual General Meetings.

The CAK boss assured Kenyans that the cooperative movement remains stable and that CAK would strongly oppose any future attempt to interfere with members' savings.

"If we had an issue coming, government interfering with our operations, CAK could have mobilized 14 million people into the streets to say no. But as we are at the moment, everything's fine."

The Cooperative Alliance of Kenya's remarks come just days after both the Ministry of Cooperatives and MSMEs Development and the National Treasury separately dismissed claims that the government intends to use SACCO members' savings to finance infrastructure projects, maintaining that no such proposal exists in the proposed legislation.