The impact of SACCO regulatory authority guidelines on SACCO operations in Kenya - The case of Nairobi deposit taking SACCOS

Abstract

The SACCO regulatory Authority (SASRA) was established by the act of government in 2008 under the SACCO Societies Act of 2008 and came into effect in September 2009. The authority is mandated with the following mandate: License SACCO Societies to carry out deposit taking business; Regulate and supervise deposit taking SACCO Societies; Manage the Deposit Guarantee Fund under the trustees appointed under the Act; Advise the Minister on national policy on deposit taking SACCO Societies in Kenya. The aim of this study was to look at the impact SASRA has had on Sacco performance since its inception. The study was conducted on the 50 deposit taking Saccos in Nairobi. Data was collected from primary source on structured questionnaires as well as secondary sources. In administering the research instruments, the researcher used self administered survey by use of mails and drops and pick letters. Based on this study, it can be concluded that, SASRA has greatly impacted on the Sacco performance in terms of outreach and sustainability and performance of SACCOs in Kenya. Most Saccos reported recent improvement in their performance both in membership, portfolio and loan cycle and general efficiency. Even though this was attributed to a number of factors ranging from increased membership, high efficiency, high demand and quick recoveries, one can easily attribute this to be as a result of SASRA regulatory framework. Most Saccos were complying with the regulator so as not to be locked out of business by the operator. It was also clear from the study that all SACCOs are conversant with the contents of the proposed SASRA guidelines