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Kenya Act or statute

Parliament of Kenya

Sacco Societies Act

This Act may be cited as the Sacco Societies Act. Contains the phrase "its non-operating holding company or its subsidiary". Section 3 applies to every deposit-taking business and to specified non-deposit taking business…

Jurisdiction
Kenya
Structure
70 provisions
Citation
Cap. 490B
Dates
As at 31 Dec 2022
More statute details
Dates
As at 31 Dec 2022

Source attribution: Source: Kenya Law

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01

Purpose and legislative effect

“This Act may be cited as the Sacco Societies Act.”

This Act may be cited as the Sacco Societies Act. Contains the phrase "its non-operating holding company or its subsidiary". Section 3 applies to every deposit-taking business and to specified non-deposit taking business as set out, with details in subsection (2). The Authority must, in consultation with the Cabinet Secretary, pay Board members remuneration or allowances for their services and expenses as it determines. The Board must conduct its business as provided in the Schedule; subject to that, the Board may regulate its own procedure.

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MISCELLANEAOUS - 69. Transitional provisions

A Sacco society carrying out deposit-taking business when this Act starts must apply for a licence under this Act within twelve months (or a shorter period if prescribed by the Cabinet Secretary in the Gazette).

Section 69

04

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Source record from new.kenyalaw.org · As at 31 Dec 2022

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Showing 70 of 70 provisions

Provision 50Offence 13Commencement 4Short title

Part I

PRELIMINARY

§ 1PRELIMINARY - 1. Short titleShort title

This Act may be cited as the Sacco Societies Act.

Section 1. Short title Section This Act may be cited as the Sacco Societies Act.
Section 1Verify source
§ 2PRELIMINARY - 2. InterpretationInterpretation

Contains the phrase "its non-operating holding company or its subsidiary".

Section 2. Interpretation Section its non-operating holding company or its subsidiary;
Section 2Verify source
§ 3PRELIMINARY - 3. ApplicationProvision

Section 3 applies to every deposit-taking business and to specified non-deposit taking business as set out, with details in subsection (2).

Section 3. Application Section 3(1)(a) every deposit-taking business; Section 3(1)(b) specified non-deposit taking business, in the manner specified in subsection (2). Section 3(2)(a) specifying the non-deposit taking business to which that subsection applies; and Section 3(2)(b) prescribing measures for the conduct of the specified business.
Section 3Verify source

Part II

THE SACCO SOCIETIES REGULATORY AUTHORITY

§ 10THE SACCO SOCIETIES REGULATORY AUTHORITY - 10. Remuneration of the Board membersProvision

The Authority must, in consultation with the Cabinet Secretary, pay Board members remuneration or allowances for their services and expenses as it determines.

Section 10. Remuneration of the Board members Section The Authority, in consultation with the Cabinet Secretary, shall pay members of the Board such remuneration or allowances for their services and expenses as it may determine. [Act No. 16 of 2018 , s. 2.]
Section 10Verify source
§ 11THE SACCO SOCIETIES REGULATORY AUTHORITY - 11. Meetings and procedure of the BoardProvision

The Board must conduct its business as provided in the Schedule; subject to that, the Board may regulate its own procedure.

Section 11. Meetings and procedure of the Board Section The conduct of the business of the Board shall be as provided in the Schedule, but subject thereto, the Board may regulate its own procedure.
Section 11Verify source
§ 12THE SACCO SOCIETIES REGULATORY AUTHORITY - 12. Appointment and remuneration of the chief executive officerProvision

Section 12 establishes the chief executive officer post: the Board appoints the CEO in consultation with the Cabinet Secretary, sets the CEO's terms, the CEO must have at least ten years' relevant experience, is an ex‑officio Board member without a vote, serves a four‑year term renewable once for up to four years, is responsible for day‑to‑day operations subject to Board policy, and the Board (with the Cabinet Secretary's approval) may appoint an acting CEO or remove the CEO for incapacity or incompetence.

Section 12. Appointment and remuneration of the chief executive officer Section 12(1) There shall be a chief executive officer who shall be appointed by the Board, in consultation with the Cabinet Secretary, and whose terms and conditions of service shall be determined by the Board in the instrument of appointment or otherwise in writing from time to time. Section 12(2) No person shall be appointed as the chief executive officer of the Authority unless he has at least ten years experience in financial management, co-operative practice and management, law, finance or economics. Section 12(3) The chief executive officer shall be an ex-officio member of the Board but shall have no right to vote at any meeting of the Board. Section 12(4) The term of office of the chief executive officer shall be four years but may be renewed for one more term of not more than four years. Section 12(5) The chief executive officer shall, subject to the general policy set by the Board, be responsible for the operations and management of the day-to-day affairs of the Authority. Section 12(6) In the event of the chief executive officer being absent or being incapacitated by reason of sickness or other cause, the Board may with the approval of the Cabinet Secretary, appoint a person to act as the chief executive officer during the period of that absence or incapacitation. Section 12(7) The Board with the approval of the Cabinet Secretary may remove the chief executive officer if, for any reason, the chief executive has become incapable of properly performing the functions of his office or is incompetent. [Act No. 16 of 2018 , s. 2.]
Section 12Verify source
§ 13THE SACCO SOCIETIES REGULATORY AUTHORITY - 13. Appointment and remuneration of staffProvision

The Board may appoint officers and employees; those officers must carry out duties assigned by the chief executive officer; the Board determines remuneration manner, rates and conditions.

Section 13. Appointment and remuneration of staff Section 13(1) The Board may appoint such other officers and employees as it considers necessary for the efficient discharge of its duties and responsibilities. Section 13(2) The officers and employees appointed under subsection (1) shall be remunerated in such manner and at such rates, and shall be subject to such conditions of service, as may be determined by the Board. Section 13(3) Every officer or employee appointed under subsection (1) shall, subject to this Act, exercise such powers and functions and perform the duties and responsibilities assigned to him from time to time by the chief executive officer.
Section 13Verify source
§ 14THE SACCO SOCIETIES REGULATORY AUTHORITY - 14. Protection from liabilityProvision

Officers and employees acting bona fide while executing the Authority's functions are not personally liable; the Authority remains liable to pay compensation or damages for injury or loss caused by its exercise of power or failure of works.

Section 14. Protection from liability Section 14(1) No matter or thing done by an officer or an employee of the Authority shall, if the matter or thing is done bona fide for executing the functions, powers or duties of the Authority, render the officer or employee so acting, personally liable for any action, claim or demand. Section 14(2) Subsection (1) shall not relieve the Authority from liability to pay compensation or damages to any person for any injury to that person, or other loss caused by the exercise of any power conferred by this Act or any other written law or by the failure of any works of the Authority.
Section 14Verify source
§ 15THE SACCO SOCIETIES REGULATORY AUTHORITY - 15. The Sacco societies levyProvision

The Authority may, by order published in the Gazette, impose a levy called the Sacco societies levy on deposits in deposit-taking Sacco societies or on another base for non-deposit-taking Sacco societies; the order may specify the rate and time of payment; unpaid amounts incur an addition of five per cent per month; levy receipts go to the General Fund.

Section 15. The Sacco societies levy Section 15(1) The Authority may by order published in the Gazette , impose a levy to be known as the Sacco societies levy on the deposits held in deposit-taking Sacco societies, or on such other base as the Authority may determine in the case of Sacco societies carrying out non-deposit taking business specified under section 3(2) . Section 15(2) A levy imposed under this section shall be payable at such rate as may be specified in the order. Section 15(3) An order under this section may contain provisions as to the time at which the amount payable by way of the levy shall become due. Section 15(4) All moneys received in respect of the levy shall be paid into the General Fund. Section 15(5) If a person fails to pay any amount payable by him by way of the levy on or before the date prescribed by the order under subsection (1), a sum equal to five per centum of the amount shall be added to the amount due for each month or part thereof during which the amount due remains unpaid. Section 15(6) If any moneys required to be paid within the time prescribed under subsection (3) is not paid on or before the date prescribed by the order, the amount due and any sum payable under subsection (5) shall be a civil debt recoverable summarily by the Authority.
Section 15Verify source
§ 16THE SACCO SOCIETIES REGULATORY AUTHORITY - 16. The Authority's General FundProvision

Establishes the Authority's General Fund, lists its sources, provides for Parliamentary grants to the Authority, and provides for payments from the General Fund to defray the Authority's expenditure.

Section 16. The Authority's General Fund Section 16(1) There is established a fund of the Authority to be known as the General Fund of the Authority which shall vest in the Authority. Section 16(2)(a) all proceeds of the levy; Section 16(2)(b) such moneys or assets as may accrue to or vest in the Authority in the course of the exercise of its powers or the performance of its functions under this Act; Section 16(2)(c) such sums as may be payable to the Authority pursuant to this Act or any other written law; Section 16(2)(d) such sums as may be granted to the Authority pursuant to subsection (3); and Section 16(2)(e) all moneys from any other source provided for or donated or lent to the Authority. Section 16(3) There shall be made to the Authority out of moneys provided by Parliament for that purpose, grants towards the expenditure incurred by the Board in the exercise of its powers of the performance of its functions under this Act Section 16(4) There shall be paid out of the General Fund such sums of money required to defray the expenditure of the Authority incurred by the authority in the discharge of its functions under this Act.
Section 16Verify source
§ 17THE SACCO SOCIETIES REGULATORY AUTHORITY - 17. Investment of funds of the AuthorityProvision

The Authority may invest its funds in authorized trust securities or other securities approved by the Cabinet Secretary, and may place unneeded moneys on deposit with banks it determines.

Section 17. Investment of funds of the Authority Section 17(1) The Authority may invest its funds in any securities which for the time being are authorized for trust funds or in any other securities which the Cabinet Secretary may, from time to time, approve. Section 17(2) The Authority may place on deposits with such bank or banks as it may determine, any moneys not immediately required for the purposes of the Authority. [Act No. 16 of 2018 , s. 2.]
Section 17Verify source
§ 18THE SACCO SOCIETIES REGULATORY AUTHORITY - 18. Financial yearProvision

The Authority's financial year is the twelve‑month period ending on 30 June each year.

Section 18. Financial year Section The financial year of the Authority shall be the period of twelve months ending on the thirtieth of June in each year.
Section 18Verify source
§ 19THE SACCO SOCIETIES REGULATORY AUTHORITY - 19. Annual estimatesCommencement

The Authority must prepare annual revenue and expenditure estimates at least three months before the financial year starts and must submit those estimates to the Cabinet Secretary for approval before the start of the financial year.

Section 19. Annual estimates Section 19(1) The Authority shall, at least three months before the commencement of the financial year, prepare estimates of revenue and expenditure for that year. Section 19(2)(a) salaries, allowances and other charges in respect of the officers and staff of the Authority; Section 19(2)(b) pensions, gratuities and other charges in respect of the retirement benefits which are payable out of the funds of the Authority; Section 19(2)(c) the maintenance, repair and replacement of the assets of the Authority; Section 19(2)(d) funds to meet future or contingent liabilities; Section 19(2)(e) authorized payments to members of the Board; and Section 19(2)(f) any other matter that the Authority may, with the approval of the Cabinet Secretary deem appropriate. Section 19(3) The estimates prepared under this section shall be submitted by the Authority to the Cabinet Secretary for approval before the start of the financial year. [Act No. 16 of 2018 , s. 2.]
Section 19Verify source
§ 20THE SACCO SOCIETIES REGULATORY AUTHORITY - 20. Accounts and auditProvision

The Authority must keep proper books and records of accounts of its income, expenditure, assets and liabilities.

Section 20. Accounts and audit Section 20(1) The Authority shall cause to be kept proper books and records of accounts of the income, expenditure, assets and liabilities of the Authority. Section 20(2)(a) a statement of income and expenditure during that period; Section 20(2)(b) a statement of the assets and liabilities of the Authority on the last day of that year. Section 20(3) The accounts of the Authority shall be audited and reported upon in accordance with the Public Audit Act ( Cap. 412B ). [Act No. 16 of 2018 , s. 4, Act No. 34 of 2022 , s. 4.]
Section 20Verify source
§ 21THE SACCO SOCIETIES REGULATORY AUTHORITY - 21. Submission and publication of annual reportsProvision

The Authority must submit an annual report to the Cabinet Secretary within four months after the financial year ends, and must publish that report in the Gazette and in at least one newspaper of national circulation after submission.

Section 21. Submission and publication of annual reports Section 21(1) The Authority shall within four months of the closure of the financial year, submit to the Cabinet Secretary a report on the operations of the Authority during that year. Section 21(2) The Authority shall, after submission of the report to the Cabinet Secretary under subsection (1), publish the report in the Gazette and in at least one newspaper of national circulation. [Act No. 16 of 2018 , s. 2.]
Section 21Verify source
§ 22THE SACCO SOCIETIES REGULATORY AUTHORITY - 22. Preparation etc. of Sacco societies performance reportProvision

The Authority must, within four months after the end of the financial year, prepare and submit to the Cabinet Secretary a report on the operations and performance of Sacco societies under this Act for that year.

Section 22. Preparation etc. of Sacco societies performance report Section The Authority shall within four months of the closure of the financial year prepare and submit to the Cabinet Secretary a report on the operations and performance of the Sacco societies under this Act during that year. [Act No. 16 of 2018 , s. 2.]
Section 22Verify source
§ 4THE SACCO SOCIETIES REGULATORY AUTHORITY - 4. Establishment of the AuthorityProvision

Establishes the Sacco Societies Regulatory Authority and lists powers including suing and being sued, acquiring property, borrowing or lending money, entering contracts, and performing acts necessary to further the Act.

Section 4. Establishment of the Authority Section 4(1) There is established an Authority to be known as the Sacco Societies Regulatory Authority. Section 4(2)(a) suing and being sued; Section 4(2)(b) taking, purchasing or otherwise acquiring, holding, charging, and disposing of both movable and immovable property; Section 4(2)(c) borrowing or lending money; Section 4(2)(d) entering into contracts; and Section 4(2)(e) doing or performing all such other things or acts necessary for the furtherance of the provisions of this Act.
Section 4Verify source
§ 5THE SACCO SOCIETIES REGULATORY AUTHORITY - 5. Objects and functions of the AuthorityProvision

The Authority must license Sacco societies to carry out deposit-taking business in accordance with this Act.

Section 5. Objects and functions of the Authority Section license Sacco societies to carry out deposit-taking business in accordance with this Act;
Section 5Verify source
§ 6THE SACCO SOCIETIES REGULATORY AUTHORITY - 6. Board of the AuthorityProvision

Sets Board membership and terms: Chairperson and four members are appointed by the Cabinet Secretary (the four must have at least ten years' relevant experience); certain persons are disqualified; members appointed under 1(e) serve three-year terms and may be re-appointed once for up to three years; such members may resign with fourteen days' notice to the Cabinet Secretary.

Section 6. Board of the Authority Section 6(1)(a) the Chairperson to be appointed by the Cabinet Secretary from amongst the members appointed under paragraph (e); Section 6(1)(b) the Principal Secretary to the Treasury or his representative; Section 6(1)(c) the Commissioner or his representative; Section 6(1)(d) the Governor of the Central Bank or his representative; Section 6(1)(e) four members, not being public officers, appointed by the Cabinet Secretary by virtue of their knowledge, and possession of a minimum of ten years experience, in co-operative practice and management, law, finance or economics; and Section 6(1)(f) the chief executive officer appointed under section 12 . Section 6(2) A member of the Board appointed under subsection (1)(e) shall hold office for a term of three years and shall be eligible for re-appointment for one more term of up to three years. Section 6(3) The members of the Board appointed under subsection (1)(e) shall be appointed at different times so that the respective expiry dates of their terms shall fall at different times. Section 6(4)(a) a Member of Parliament or a County Assembly; Section 6(4)(aa) one who does not meet the requirements of Chapter Six of the Constitution; Section 6(4)(b) a director or employee of a Sacco society or of a co-operative society; Section 6(4)(c) auditor of a Sacco society or of co-operative society; and Section 6(4)(d) a person who is prohibited from being a director or to take part in the management of a cooperative or financial institution by the Commissioner under the Co-operative Societies Act ( Cap. 490 ) or by the Central Bank of Kenya respectively. Section 6(5)(a) accepts any office the holding of which, if he were not a member of the Board, would make him ineligible for appointment to the office of a member of the Board; Section 6(5)(b) fails to discharge the functions of his office whether arising from infirmity of body or mind or any other cause; Section 6(5)(c) conducts himself in a manner not befitting a member of the Board; and Section 6(5)(d) becomes subject to any disqualification set out in subsection (4)(d). Section 6(6) A member of the Board appointed under subsection (1)(e) may resign office by giving a fourteen days notice to the Cabinet Secretary. [Act No. 16 of 2018 , ss. 2 & 3, Act No. 34 of 2022 , s. 3.]
Section 6Verify source
§ 7THE SACCO SOCIETIES REGULATORY AUTHORITY - 7. Powers of the BoardProvision

The Board has the power to supervise, control and administer the Authority's assets to promote the Authority's objects and functions.

Section 7. Powers of the Board Section supervise, control and administer the assets of the Authority in such manner and for such purposes as would best promote the objects and functions for which the Authority is established;
Section 7Verify source
§ 8THE SACCO SOCIETIES REGULATORY AUTHORITY - 8. Committees and delegation of powersOffence

The Board may appoint committees; the Board may delegate powers by resolution to committees, members, officers, employees, or agents; officers, employees and agents shall not disclose information acquired in the course of duties except for performance of duties or when required by other law; contravention of that non-disclosure is an offence punishable by a fine not exceeding one hundred thousand shillings, or imprisonment not exceeding one year, or both.

Section 8. Committees and delegation of powers Section 8(1) The Board may appoint committees from among its own members or otherwise, to carry out such general or special functions as may be specified by the Board. Section 8(2) The Board may, by resolution, either generally or in any particular case, delegate to any committee of the Board or to any member, officer, employee, or agent of the Authority, the exercise of any of the powers or the performance of any of the functions or duties of the Authority under this Act or under any other written law. Section 8(3) Except for purposes of the performance of his duties or the exercise of his powers under this Act, or where required under any other law to do so, any officer or any other employee or agent of the Authority shall not disclose any information which he has acquired in the course of the performance of his duties or the exercise of his powers in accordance with this Act. Section 8(4) Any person who contravenes subsection (3) commits an offence and is liable on conviction to a fine not exceeding one hundred thousand shillings, or to imprisonment for a term not exceeding one year, or to both such fine and imprisonment.
Section 8Verify source
§ 9THE SACCO SOCIETIES REGULATORY AUTHORITY - 9. Common seal of the BoardProvision

The Board must keep the Authority's common seal in custody as it directs; it must not be used except on the Board's order. When affixed and duly authenticated the seal makes a document judicially and officially noticed. The seal is authenticated by signatures of the chief executive officer and the chairperson or another officer authorized by the Board. Non-sealed documents and decisions may be signed by the chairperson or the meeting's presiding person.

Section 9. Common seal of the Board Section 9(1) The common seal of the Authority shall be kept in such custody as the Board may direct and shall not be used except on the order of the Board. Section 9(2) The common seal of the Authority when affixed to a document and duly authenticated shall be judicially and officially noticed and unless and until the contrary is proved, any necessary order or authorization by the Board under this section shall be presumed to have been duly given. Section 9(3) The common seal of the Authority shall be authenticated by the signature of the chief executive officer and the chairperson of the Board or any one other officer authorized by the Board in that behalf. Section 9(4) All documents, other than those required by law to be under seal, made by, and all decisions of, the Authority may be signified under the hand of the chairperson, in the case of a decision taken at a meeting at which the chairperson is not present, under the hand of the person presiding at such meeting.
Section 9Verify source

Part III

LICENSING OF SACCO SOCIETIES

§ 23LICENSING OF SACCO SOCIETIES - 23. Carrying out of deposit-taking businessOffence

Only a Sacco society that is registered under the Co-operative Societies Act and holds a valid licence under this Act may carry out deposit-taking business; contravening this section is an offence punishable by a fine up to five hundred thousand shillings or up to three years imprisonment; the Cabinet Secretary may make regulations, in consultation with the Authority, for licensing and supervision of co-operative societies carrying out deposit-taking business in compliance with Islamic law.

Section 23. Carrying out of deposit-taking business Section 23(1)(a) is a Sacco society registered under the Co-operative Societies Act ( Cap. 490 ); and Section 23(1)(b) holds a valid licence issued under this Act. Section 23(2) A person who contravenes the provisions of this section commits an offence and shall be liable, on conviction, to a fine not exceeding five hundred thousand shillings, or to imprisonment for a term not exceeding three years, or to both such fine and imprisonment. Section 23(3) The Cabinet Secretary may, in consultation with the Authority, make regulations providing for the licensing and supervision of co-operative societies carrying out deposit taking business in compliance with Islamic law. [Act No. 15 of 2017 , s. 53.]
Section 23Verify source
§ 24LICENSING OF SACCO SOCIETIES - 24. Application for licenceProvision

Sacco societies intending to take deposits must apply in writing to the Authority for a licence in the prescribed form before commencing deposit-taking business; they may appeal a refusal to the Cabinet Secretary within thirty days; the Authority must make regulations, in consultation with the Cabinet Secretary, setting further requirements before a licence is granted.

Section 24. Application for licence Section 24(1) A Sacco society intending to transact the deposit-taking business in Kenya shall, before commencing such business, apply in writing, to the Authority for a licence, in the prescribed form. Section 24(2)(a) a copy of the certificate of registration and the by-laws of the Sacco society; Section 24(2)(b) evidence that the Sacco society meets the minimum capital requirements prescribed in the regulations; Section 24(2)(c) information relating to the place of business, indicating that of the head office, and branches, if any; Section 24(2)(d) the prescribed fees; Section 24(2)(e) objectives of the deposit-taking Sacco society business; Section 24(2)(e)(i) objectives of the deposit-taking Sacco society business; Section 24(2)(e)(ii) membership and share capital; Section 24(2)(e)(iii) economic and financial environment; Section 24(2)(e)(iv) organisational structure and management; and Section 24(2)(e)(v) financial and risk analysis. Section 24(2)(f) such other requirements as the Authority may prescribe. Section 24(3) A Sacco society may appeal to the Cabinet Secretary in reference to refusal to grant a licence within thirty days after receipt of notification of refusal. Section 24(4)(a) the Authority failed to follow required procedures in making its decision; Section 24(4)(b) the Authority's decision was contrary to the Act and the regulations; Section 24(4)(c) there was no factual basis for the Authority's decision; or Section 24(4)(d) based on a review of the record the Authority committed a manifest error in its assessment of facts, or abused its discretion in taking its decision. Section 24(5) The Authority shall, in consultation with the Cabinet Secretary make regulations providing for further requirements to be fulfilled before the grant of license to a Sacco society. [Act No. 16 of 2018 , s. 2 & 4, Act No. 34 of 2022 , s. 5.]
Section 24Verify source
§ 25LICENSING OF SACCO SOCIETIES - 25. Issuance of licenceCommencement

The Authority considers licence applications under section 24 and may grant licences on payment of the prescribed fee; upon payment it must issue licences (to allow deposit-taking business) and must issue them within 14 days where requirements are fulfilled. Sacco societies must pay an annual licence fee as prescribed and, if they fail to commence deposit-taking business within 12 months of grant, must reapply; failure to pay the annual fee attracts a prescribed penalty.

Section 25. Issuance of licence Section 25(1) The Authority shall consider every application made under section 24 and may, if satisfied that the applicant meets the requirements of this Act, grant a licence to the applicant upon payment of the prescribed fee. Section 25(2) The Authority shall upon the payment by the applicant of the prescribed fee, issue a licence to a Sacco society to carry out deposit-taking Sacco society business. Section 25(3) The licence referred to in subsection (2) shall, where the other requirements of this section are fulfilled, be issued within fourteen days from the date of payment of the prescribed fee. Section 25(4) Every Sacco society shall be required to pay an annual licence fee of such amount and within such time as may be prescribed by the Authority. Section 25(5) A Sacco society which fails to pay the annual fee by the date on which such payment is due shall in addition to any action by the Authority under section 27 be liable to pay such penalty as the Authority may prescribe. Section 25(6) A Sacco society which fails to commence deposit-taking Sacco business within twelve months of the grant of a licence under this Act shall, if it still proposes to operate such business, make fresh application under section 24 . Section 25(7) The Authority may grant or refuse an application made under subsection (6) and its decision shall be final.
Section 25Verify source
§ 26LICENSING OF SACCO SOCIETIES - 26. Conditions of a licenceSubstitution

The Authority must endorse conditions on licences and may add, vary or substitute those conditions; it may restrict licences instead of revoking them and may impose time limits (not exceeding one year) or other conditions to protect depositors.

Section 26. Conditions of a licence Section 26(1) The Authority shall endorse on a licence granted under this Act such conditions as it considers necessary and may from time to time add, vary or substitute such conditions as it deems appropriate. Section 26(2) Where it appears to the Authority that there are reasonable grounds for the revocation of a licence, but that the circumstances are such as that the revocation would not be expedient or would be unjust to the members, the Authority may restrict the licence in accordance with subsection (3). Section 26(3)(a) a limit on the duration of the licence for a period not exceeding one year; or Section 26(3)(b) such additional conditions for the protection of depositors as the Authority may deem necessary.
Section 26Verify source
§ 27LICENSING OF SACCO SOCIETIES - 27. Revocation of licenceProvision

The Authority may revoke a Sacco society's licence for specified grounds; before revocation it must give at least 14 days' written notice and consider representations; it must publish revoked licences; revoked societies are not entitled to refund; aggrieved societies may appeal within 30 days; an appeal does not suspend Authority actions.

Section 27. Revocation of licence Section 27(1)(a) ceases to carry on deposit-taking business in Kenya or goes into liquidation or is wound up or is otherwise dissolved or deregistered under the Co-operative Societies Act ( Cap. 490 ); Section 27(1)(b) fails to comply with this Act, or any rules, regulations, orders or directions issued under the Act or any condition of the licence; Section 27(1)(c) fails to pay the annual license fee as required under section 25(3) ; Section 27(1)(d) does not hold at least fifty percent of the capital requirements as may be prescribed in the regulations; Section 27(1)(e) has knowingly engaged in serious criminal or fraudulent acts that are likely to cause insolvency, substantial dissipation of assets or earnings or may otherwise weaken the deposit-taking Sacco society's condition or seriously prejudice the interests of the deposit-taking Sacco society's members. Section 27(2) The Authority shall, before revoking a licence, give to the Sacco society not less than fourteen days' notice in writing of its intention and shall consider any representations made to it in writing by the Sacco society within that period before revoking the licence. Section 27(3) The Authority shall cause the name of every Sacco society whose licence is revoked under this section to be published forthwith in the Gazette and at least one newspaper of national circulation. Section 27(4) Where the licence of a Sacco society is revoked or cancelled, the Sacco society shall not be entitled to any refund of the license fee in respect of any unexpired period of the licence. Section 27(5) An aggrieved Sacco society may appeal to the Cabinet Secretary in respect of a revocation of its licence within thirty days after being notified of the revocation. Section 27(6) An appeal shall not have the effect or suspending the actions of the Authority while the appeal is being pursued. Section 27(7)(a) the Authority failed to follow required procedures in making its decision; Section 27(7)(b) the Authority's decision was contrary to this Act and the regulations; Section 27(7)(c) there was no factual basis for the Authority's decision; or Section 27(7)(d) based on a review of the record, the Authority committed a manifest error in its assessment of facts, or abused its discretion in taking its decision. Section 27(8) The registration of a Sacco Society, the license of which is revoked under the provisions of this Act, shall be cancelled in accordance with section 62 of the Co-operative Societies Act. [Act No. 16 of 2018 , ss. 2 & 6, Act No. 34 of 2022 , s. 6.]
Section 27Verify source
§ 28LICENSING OF SACCO SOCIETIES - 28. Publication of Sacco societiesProvision

The Authority must publish a list of all Sacco societies once every year in the Gazette and in at least one newspaper of national circulation.

Section 28. Publication of Sacco societies Section The Authority shall cause the list of all Sacco societies to be published once every year in the Gazette and at least in one newspaper of national circulation.
Section 28Verify source

Part IV

GOVERNANCE OF SACCO SOCIETIES

§ 29GOVERNANCE OF SACCO SOCIETIES - 29. Minimum capital requirementsProvision

All Sacco societies must comply with and maintain at all times the minimum capital requirements as may be prescribed by the Authority.

Section 29. Minimum capital requirements Section All Sacco societies shall comply with and maintain at all times the minimum capital requirements as may be prescribed by the Authority.
Section 29Verify source
§ 30GOVERNANCE OF SACCO SOCIETIES - 30. Minimum liquid assetsOffence

Sacco societies must maintain minimum liquid assets as prescribed by the Authority and calculate average monthly balances; failure to comply may incur daily penalty interest.

Section 30. Minimum liquid assets Section 30(1) A Sacco society shall maintain such minimum holding of liquid assets of its members' deposits and borrowings as may be prescribed by the Authority. Section 30(2) Every Sacco society shall calculate the average monthly balance of its deposits and borrowings at the close of business on such day as may be prescribed by the Authority. Section 30(3) A Sacco society which does not comply with the requirements of subsection (1), within such period as the Authority may prescribe, shall be liable to pay, on being called upon to do so by the Authority, a penalty interest charge not exceeding one percent or the amount of the deficiency, for every day during which the offence continues.
Section 30Verify source
§ 31GOVERNANCE OF SACCO SOCIETIES - 31. Prohibited businessProvision

A Sacco society must only engage in business types that the Authority prescribes.

Section 31. Prohibited business Section A Sacco society shall engage only in such business as the Authority shall prescribe.
Section 31Verify source
§ 32GOVERNANCE OF SACCO SOCIETIES - 32. Place of businessOffence

Sacco societies may not open or relocate branches or places of business in Kenya without the approval of the Authority; contravention is an offence punishable by a fine not exceeding one hundred thousand shillings, or imprisonment up to three years, or both.

Section 32. Place of business Section 32(1) No Sacco society may open in Kenya a branch or a new place or business or change the location of a branch or the existing place of business in Kenya without the approval of the Authority. Section 32(2) A person who contravenes the provisions of this section commits an offence and shall be liable, on conviction, to a fine not exceeding one hundred thousand shillings, or to imprisonment for a term not exceeding three years or to both such fine and imprisonment.
Section 32Verify source
§ 33GOVERNANCE OF SACCO SOCIETIES - 33. Application for loan or credit facilityProvision

Members may apply in writing for loans; applicants must show ability to repay; Sacco societies may accept specified security when required and must not lend to non-members.

Section 33. Application for loan or credit facility Section 33(1) Any member of a Sacco society may apply to the Sacco society for a loan or credit facility in writing. Section 33(2) A person who applies for a loan or credit facility under subsection (1) shall provide evidence of his or her ability to repay the loan or credit facility. Section 33(3)(a) a loans policy and procedures manual specifying the criteria and procedures applicable in the evaluation, processing, approval, documentation and release of loans or credit facilities; Section 33(3)(b) an asset review system, which shall accurately identify risk and assure the adequacy of the provisions for losses account; Section 33(3)(c) a system of reviewing the entire asset portfolio including contingent accounts or off balance sheet items and adequate provisioning for losses at periodic monthly intervals. Section 33(4) Where security is required with respect to a loan, the Sacco society may accept as security against any loan, an endorsement by a guarantor or co-guarantor, assignment of an interest in real or personal property, deposits or wages of the borrower or any collateral as may be prescribed by the Authority. Section 33(5) No Sacco society shall grant a loan or credit facility to a person who is not a member of that society.
Section 33Verify source
§ 34GOVERNANCE OF SACCO SOCIETIES - 34. Limits on loans and credit facilityOffence

Sacco societies must not grant loans or credit facilities to members that exceed limits based on core capital, nor grant loans secured by the society's core capital; the Authority may prescribe the core-capital limit; contraventions are offences punishable by a fine up to 100,000 shillings, or imprisonment up to two years, or both.

Section 34. Limits on loans and credit facility Section 34(1) No Sacco society shall grant a loan or credit facility to a member where the loan or credit facility, in the aggregate, exceeds such limit of the society's core capital as the Authority may prescribe. Section 34(2) No Sacco society shall grant a loan or credit facility against the security of the core capital of the society. Section 34(3) Any person who contravenes the provisions of this section commits an offence and shall be liable, on conviction, to a fine not exceeding one hundred thousand shillings, or to imprisonment for a term not exceeding two years, or to both such fine and imprisonment.
Section 34Verify source
§ 35GOVERNANCE OF SACCO SOCIETIES - 35. Insider lendingProvision

Sacco societies may lend to employees and board members; applicants for such loans must not participate in consideration of their own applications; directors, officers, employees and board members must not act as guarantors; aggregate lending to staff/officials is limited to a proportion of total assets prescribed by the Authority.

Section 35. Insider lending Section 35(1) A Sacco society may make loans to its employees and members of its board of directors. Section 35(2) The conditions for the grant of a loan or credit facility to an employee or board member shall comply with all requirements under this Act with respect to loans to other members and shall not be made on terms more favourable than those extended to other members. Section 35(3) A person who has applied for a loan or credit facility to which this section applies shall not be present nor participate in the consideration of the application. Section 35(4) No director, officer, employee or a member of the board of a Sacco society shall act as a guarantor of any person with respect to a loan advanced or credit facility granted to a person by that society. Section 35(5) A Sacco society may lend to its staff and officials an amount in the aggregate not exceeding such proportion of its total assets as prescribed by the Authority.
Section 35Verify source
§ 36GOVERNANCE OF SACCO SOCIETIES - 36. Charge against shares and savings depositsProvision

A Sacco society must have a first charge on members' deposits and share capital and on dividends or interest payable to a member for debts owed to the society; the society may refuse withdrawals from a member's deposit account if the member is in arrears on a debt owed to the society.

Section 36. Charge against shares and savings deposits Section 36(1) A Sacco society shall have a first charge against deposits and share capital and upon any dividend or interest payable to a member for any debt due to the society from the member, either as a guarantor or endorser of a loan or credit facility or for any other obligation. Section 36(2) A Sacco society may refuse to allow withdrawals from any deposit account operated by a member where the member is in arrears on a debt owed to the society.
Section 36Verify source
§ 37GOVERNANCE OF SACCO SOCIETIES - 37. Dormant accountsProvision

The treatment of members' dormant accounts shall be in such manner as may be prescribed by the Authority.

Section 37. Dormant accounts Section The treatment of members' dormant accounts shall be in such manner as may be prescribed by the Authority.
Section 37Verify source
§ 38GOVERNANCE OF SACCO SOCIETIES - 38. Investment by Sacco societiesProvision

A Sacco society shall not purchase or acquire land or any interest in land except when reasonably necessary for its deposit-taking business and subject to limits the Authority may prescribe.

Section 38. Investment by Sacco societies Section 38(1)(a) securities, obligations or, other debt instruments issued or guaranteed by the government or any agency of the government; Section 38(1)(b) deposits, obligations or other accounts of deposit-taking institutions under the Banking Act ( Cap. 488 ); Section 38(1)(c) shares, stocks, deposits in, loans to or other obligations of any Sacco society or co-operative society. Section 38(2) An investment made under this section shall not in the aggregate, exceed such proportion of the total core capital and deposits of a Sacco society as the Authority may prescribe. Section 38(3) A Sacco society shall not purchase or acquire any land or any interest or right therein except as may be reasonably necessary for the purpose of conducting its deposit-taking business and where such investments do not exceed such proportion of the total assets of the society as the Authority may prescribe.
Section 38Verify source
§ 39GOVERNANCE OF SACCO SOCIETIES - 39. Financial yearProvision

A Sacco society's financial year is the twelve‑month period ending on 31 December each year.

Section 39. Financial year Section The financial year of a Sacco society shall be the period of twelve months ending the thirty-first December in each year.
Section 39Verify source
§ 40GOVERNANCE OF SACCO SOCIETIES - 40. Form of accountsProvision

Every Sacco society must keep proper books of accounts; accounts must show a true and fair state of affairs and explain transactions to enable the Authority to determine compliance; accounts and financial records shall be denominated in Kenya shillings and comply with international financial reporting standards and other requirements as the Authority may prescribe; the board of directors must cause the accounts to be audited within three months after the close of each financial year.

Section 40. Form of accounts Section 40(1) Every Sacco society shall keep proper books of accounts. Section 40(2)(a) show a true and fair state of affairs; and Section 40(2)(b) explain all transactions and financial position to enable the Authority determine whether the Sacco society has complied with the provisions of this Act and the regulations made under this Act. Section 40(3) The accounts and other financial records of a Sacco society shall be denominated in Kenya shillings and shall comply with the international financial reporting standards and such other requirements as the Authority may prescribe. Section 40(4) The board of directors shall cause the accounts of the Sacco society to be audited within three months after the close of each financial year.
Section 40Verify source
§ 41GOVERNANCE OF SACCO SOCIETIES - 41. Submission of accounts to the AuthorityOffence

Submission of accounts to the Authority: an audited balance sheet showing assets and liabilities; an audited profit and loss account; and a copy of the auditor's report; contravention is an offence.

Section 41. Submission of accounts to the Authority Section 41(1)(a) an audited balance sheet, showing its assets and liabilities; Section 41(1)(b) an audited profit and loss account; and Section 41(1)(c) a copy of the auditor's report; Section 41(2) A person who contravenes the provisions of this section commits an offence.
Section 41Verify source
§ 42GOVERNANCE OF SACCO SOCIETIES - 42. Disclosure requirementsProvision

Members who hold more than twenty percent of the share capital and deposits in the Sacco society are identified in the disclosure requirements.

Section 42. Disclosure requirements Section members, if any, who hold more than twenty percent of the share capital and deposits in the Sacco society;
Section 42Verify source
§ 43GOVERNANCE OF SACCO SOCIETIES - 43. Appointment of internal auditorProvision

Every Sacco society must appoint an internal auditor, and that internal auditor must report to the board of directors on internal control systems and financial matters.

Section 43. Appointment of internal auditor Section 43(1) Every Sacco society shall appoint an internal auditor who shall report to the board of directors on the internal control systems and financial matters of the society. Section 43(2) No person shall be appointed as an internal auditor under this section unless the person holds such professional qualifications in accounting and has such experience in deposit-taking business, as may be prescribed by the Authority.
Section 43Verify source
§ 44GOVERNANCE OF SACCO SOCIETIES - 44. Appointment of external auditorsProvision

External auditors must submit a report to the Authority within four months after each financial year; a Sacco society must not remove or change external auditors during their appointment year without the Authority's prior approval; the board must appoint a replacement auditor for a casual vacancy with Authority approval.

Section 44. Appointment of external auditors Section 44(1)(a) a person qualified under section 45 ; Section 44(1)(b) approved by the annual general meeting of that society; and Section 44(1)(c) appointed as such by the Authority. Section 44(2) A Sacco society shall not remove or change its external auditors in the course of the year of the appointment of such auditors except with the prior approval of the Authority. Section 44(3) An external auditor shall, not less than four months after the end of each financial year, submit his report to the Authority, on the financial conditions of the deposit-taking business of the Sacco society for which he has been appointed. Section 44(4)(a) solvency of the Sacco society's business and any concerns with respect to the financial condition of the society's business; Section 44(4)(b) any violation of prudential standards or a condition of the licence; and Section 44(4)(c) any other contravention of this Act. Section 44(5) Where for any reason a casual vacancy occurs in the appointment of the external auditor in the course of the year of that appointment, the board of directors of the Sacco society shall, with the approval of the Authority and subject to subsection (1), appoint another external auditor.
Section 44Verify source
§ 45GOVERNANCE OF SACCO SOCIETIES - 45. Qualifications of external auditorsProvision

External auditors are qualified as auditors under the Companies Act (Cap. 486).

Section 45. Qualifications of external auditors Section is qualified as an auditor under the Companies Act (Cap. 486);
Section 45Verify source
§ 46GOVERNANCE OF SACCO SOCIETIES - 46. Display and publication of audited financial statementsOffence

A Sacco society must display, throughout the year and in a conspicuous position in every place of business, a copy of its most recent audited financial statements in the prescribed format; failure to comply makes the Sacco liable to pay a penalty to the Authority not being less than one hundred thousand shillings as may be prescribed.

Section 46. Display and publication of audited financial statements Section 46(1) A Sacco society shall display, throughout the year, in a conspicuous position in every place of business, a copy of its last audited financial statements in the prescribed format. Section 46(2) A Sacco society which does not comply with the provisions of this section shall be liable to pay to the Authority such penalty, not being less than one hundred thousand shillings, as may be prescribed by the Authority.
Section 46Verify source
§ 47GOVERNANCE OF SACCO SOCIETIES - 47. Annual general meeting to be supreme organProvision

The annual general meeting of a co-operative society is the supreme organ of a Sacco society.

Section 47. Annual general meeting to be supreme organ Section The annual general meeting of a co-operative society as established under the Co-operatives Societies Act ( Cap. 490 ) shall be the supreme organ of a Sacco society.
Section 47Verify source

Part V

REGULATION AND SUPERVISION OF SACCO SOCIETIES.

§ 48REGULATION AND SUPERVISION OF SACCO SOCIETIES. - 48. Regulation and supervision of Sacco societiesProvision

The Authority shall be responsible for the regulation and supervision of Sacco societies to which this Act applies.

Section 48. Regulation and supervision of Sacco societies Section 48(1) The Authority shall be responsible for the regulation and supervision of Sacco societies to which this Act applies. Section 48(2)(a) prescribe prudential standards to be adhered to by Sacco societies; Section 48(2)(b) undertake inspections or require a Sacco society to submit information and reports on its financial affairs of the deposit-taking business to enable the Authority to evaluate the society's financial condition; Section 48(2)(c) require or oversee Sacco societies' workout plan to avert or alleviate financial difficulties; Section 48(2)(d) prescribe the maximum number of years an external auditor may serve the same Sacco society; Section 48(2)(e) exercise such incidental powers as may be necessary or requisite to enable it to effectively carry out its functions under this Act.
Section 48Verify source
§ 49REGULATION AND SUPERVISION OF SACCO SOCIETIES. - 49. Powers of the Authority to inspectOffence

The Authority may inspect any Sacco society and its records; if directed by the Cabinet Secretary it must cause an inspection. Where inspected, the society and its officers must produce books, records and information within the period directed; failure to produce is an offence. The Authority shall assist investigative authorities and must submit and present inspection reports to the Commissioner and to the society's board respectively.

Section 49. Powers of the Authority to inspect Section 49(1) The Authority may, at any time and from time to time, and shall, if so directed by the Cabinet Secretary, cause an inspection to be made by any person authorized by the Authority in writing of any Sacco society and of its books, accounts and records. Section 49(2) The Authority shall assist any investigative authority regarding matters of suspected fraud or malpractice in Sacco societies either by identification of such matters for referral or at the request of such authority. Section 49(3) Where an inspection is made under subsection (1), the society concerned and every officer or employee thereof shall produce and make available to the person making the inspection, all books, accounts, records and other documents of the Sacco society and such correspondence, statements and information relating to the society as the person making the inspection may require, and within such period as he may direct in writing. Section 49(4) A person who fails to produce any books, accounts, records, documents, correspondence, statements or the information required under subsection (2), within the period specified in the relevant direction, commits an offence. Section 49(5)(a) any breach or contravention of any of provisions of this Act or any regulations made under this Act; Section 49(5)(b) any irregularity in the manner of conduct of the inspected society; Section 49(5)(c) any mismanagement of a Sacco society; and Section 49(5)(d) any other matter relating to a Sacco society not consistent with sound and prudent business practice. Section 49(6) A copy of the report of the findings of an inspection under subsection (1) shall be submitted by the Authority to the Commissioner. Section 49(7) A report of the findings of an inspection under subsection (1) shall, in addition to any action that may be taken under the Co-operative Societies Act ( Cap. 490 ) be presented by the Authority to the board of directors of the Sacco society. [Act No. 16 of 2018 , s. 2.]
Section 49Verify source
§ 50REGULATION AND SUPERVISION OF SACCO SOCIETIES. - 50. Powers of the Authority to advise and directOffence

The Authority may advise, recommend, issue directions (including appointing advisors) to Sacco societies and must serve notice before issuing directions; recipients of directions must comply, and failure to comply is an offence with additional daily penalties.

Section 50. Powers of the Authority to advise and direct Section 50(1)(a) the business of a Sacco society is being conducted in a manner contrary to or not in compliance with the requirements of this Act or of any regulations made thereunder or in any manner detrimental to or not in the best interest of its members or members of the public, or Section 50(1)(b) give advice and make recommendations to the Sacco society with regard to the conduct of its business generally; Section 50(1)(b)(i) give advice and make recommendations to the Sacco society with regard to the conduct of its business generally; Section 50(1)(b)(ii) issue directions regarding measures to be taken to improve the management or business methods of the society or to secure or improve compliance with the requirements of this Act, any regulations made thereunder or any other written law or regulations; Section 50(1)(b)(iii) in any case to which paragraph (b) applies, issue directions to the Sacco society, officer or other person to cease such practice; Section 50(1)(b)(iv) appoint a person, suitably qualified and competent in the opinion of the Authority, to advise and assist the Sacco society generally or for the purposes of implementing any directions under subparagraphs (ii) and (iii). Section 50(2) The advice of a person appointed under subsection 1(b)(iv) shall have the same force and effect as a direction made under subsection 1(b) (ii) and (iii) and shall be deemed to be a direction of the Authority under this section. Section 50(3) The Authority shall, before issuing a direction under subsection (1), serve upon the-Sacco society, officer or other person, a notice of such intent specifying the reasons therefor and requiring the Sacco society, officer or other persons, within such period as may be specified in the notice, to show cause why such direction should not be issued. Section 50(4) A Sacco society which receives a direction under this section shall comply with the direction within such period as may be specified in the direction and, if so required, shall produce evidence that it has done so. Section 50(5)(a) the prudential standards to be adhered to by a Sacco society in the conduct of its business in Kenya; and Section 50(5)(b) regulations to be adhered to by Sacco societies in order to maintain a stable and efficient deposit-taking Sacco movement and financial system. Section 50(6) A person who fails to comply with any direction under this section commits an offence and shall, in addition to the penalty prescribed under this Act, be liable to such additional penalty as may be prescribed for each day or part thereof during which the offence continues. Section 50(7) The Authority may impose minimum standards on significant members and officers of a Sacco society as prescribed.
Section 50Verify source
§ 51REGULATION AND SUPERVISION OF SACCO SOCIETIES. - 51. Supervisory enforcement actionsProvision

Allows restriction, suspension or prohibition of the payment of dividends by the society.

Section 51. Supervisory enforcement actions Section restrict, suspend or prohibit the payment of dividends by the society;
Section 51Verify source
§ 52REGULATION AND SUPERVISION OF SACCO SOCIETIES. - 52. Powers of the Authority to intervene in managementProvision

The Authority may intervene in Sacco management by appointing managers or directors, revoking powers given by institutions, and such appointees serve limited terms (not exceeding twelve months for directors and six months for managers) with the High Court permitted to extend the manager's term on application by the Authority.

Section 52. Powers of the Authority to intervene in management Section 52(1)(a) appoint a person to manage the affairs of the Sacco society and to exercise all the powers of the society to the exclusion of the board of directors, including the use of the corporate seal of the society; Section 52(1)(b) appoint a competent person familiar with deposit-taking business to its board of directors, to hold office as a director for a period not exceeding twelve months, who shall not be removed from office except with the prior approval of the Authority; and Section 52(1)(c) by notice in the Gazette , revoke or cancel any existing power of attorney, mandate, appointment or other authority by an institution in favour of any officer or employee or any other person. Section 52(2) A person appointed to manage a Sacco society under this section shall hold office for a period not exceeding six months but the High Court may, on the application of the Authority, extend such period as it may deem necessary.
Section 52Verify source
§ 53REGULATION AND SUPERVISION OF SACCO SOCIETIES. - 53. Collection and furnishing of information to the Authority etc.Provision

Authority and authorized persons may require returns or information by written notice; the Authority may collect data and require returns from Saccos or institutions; the Cabinet Secretary may require information; required parties must furnish information within specified or reasonable periods.

Section 53. Collection and furnishing of information to the Authority etc. Section 53(1) The Authority or any person officially authorized in that behalf by the Authority may, by notice in writing, require any person to furnish to the Authority or to the authorized person, within such period as is specified in the notice, all such returns or information as specified in such notice. Section 53(2) The Authority shall collect such data and other information as may be necessary to enable it to maintain supervision and surveillance of the affairs of Sacco societies and the protection of their members funds and, for this purpose, may require any Sacco society to submit statistical and other returns on a periodic basis in addition to any other returns required by law or as prescribed by the Authority. Section 53(3) The Authority may require any institution to furnish to the Authority, at such time and in such manner as the Authority may direct, such information as the Authority may reasonably require for the proper discharge of its functions under this Act. Section 53(4) The information required to be furnished under this section may include information relating to any person which is an associate of the Sacco society required to furnish information under that subsection. Section 53(5) The Cabinet Secretary may require the Authority or a deposit-taking Sacco society to furnish to him, at such time and in such manner as he may direct, such information as the Cabinet Secretary may require. Section 53(6) Where the Authority or person is required to furnish information under this Part, the Authority, institution or person shall furnish that information and any supplemental material that may be required as a result of that information within the period specified under this Part or within such reasonable period thereafter as may be agreed or directed. [Act No. 16 of 2018 , s. 2.]
Section 53Verify source
§ 53AREGULATION AND SUPERVISION OF SACCO SOCIETIES. - 53A. Application of Information and Communications TechnologyProvision

The Authority may set up and run an electronic filing system; Sacco Societies must file required returns and information through that system subject to the Authority's directions or guidelines.

Section 53A. Application of Information and Communications Technology Section 53A(1) The Authority may establish and operate an electronic filing system for the purposes of electronic filing of the statutory returns and documents or other information required to be furnished to the Authority under the Act or any other written law. Section 53A(2)(a) the registration of Sacco Societies to participate in the electronic filing system; Section 53A(2)(b) the issuing and cancellation of authentication of codes to the registered users of the electronic system; Section 53A(2)(c) statutory returns, documents or other information that may be transmitted through the electronic filing system; Section 53A(2)(d) the correction of errors in, or amendments to, statutory returns, documents or other information filed in the electronic filing system; Section 53A(2)(e) the use of the electronic filing system, including the procedure applicable if there is a breakdown or other interruption in the system; Section 53A(2)(f) the use, in any electronic transmission or filing, of symbols, codes, abbreviations or other notations to represent any particulars or information required under the Act or any other written law; and Section 53A(2)(g) any other matters for the better use and provision of the electronic filing system. Section 53A(3) A Sacco Society shall, subject to any directions or guidelines issued by the Authority, furnish any return, document or other information required to be furnished under the Act, these Regulations or any other written law through the use of the electronic filing system established by the Authority. Section 53A(4) The Authority may, in accordance with the directions or guidelines issued under subsection (3), serve a notice or any other document to the registered computer account of the Sacco Society. [Act No. 16 of 2018 , s. 9, Act No. 34 of 2022 , s. 9.]
Section 53AVerify source
§ 54REGULATION AND SUPERVISION OF SACCO SOCIETIES. - 54. Publication and sharing of informationOffence

Sets rules on publication and sharing of information: the Authority or Cabinet Secretary may publish information; persons who receive information under the Act must not disclose it except as permitted; the Authority and Sacco societies may exchange information as prescribed; unauthorised disclosure is an offence.

Section 54. Publication and sharing of information Section 54(1) The Authority or the Cabinet Secretary, as the case may be, may publish in whole or in part, at such times and in such manner as it or he thinks fit, any information furnished to it or him under this Act. Section 54(2) The information furnished under this subsection shall not be published if it would disclose the financial affairs of any person in a level of detail down to the individual account holder, unless the consent in writing of that person has first been given. Section 54(3) Except as provided in this Act, no person shall disclose or publish any information which comes into his possession in the course of the performance of his duties or responsibilities under this Act and, if he does so, he shall be deemed to have contravened the provisions of this Act. Section 54(4) A person who discloses or publishes any information on contravention of subsection (3) commits an offence. Section 54(5)(a) the Authority may disclose any information received by it under this Act to any financial regulatory authority, tax authority, fraud investigations authority or pursuant to a court order, within or outside Kenya, where such information is reasonably required for the proper discharge of the functions of the Authority or the requesting financial regulatory authority, tax authority, investigation authority or court; Section 54(5)(b) Sacco societies shall, in the ordinary course of business and in such manner and to such extent as the Cabinet Secretary may, by regulation prescribe, exchange such information on non-performing loans as may, from time to time, be specified by the Authority; Section 54(5)(c) the Authority and any Sacco society may, in the ordinary course of business in such manner and to such extent as the Cabinet Secretary may, by regulation prescribe, exchange such information as is reasonably required for the proper discharge of their functions. Section 54(6)(a) the Authority or to another Sacco society; or Section 54(6)(b) a credit reference bureau;
Section 54Verify source

Part VI

THE DEPOSIT GUARANTEE FUND

§ 55THE DEPOSIT GUARANTEE FUND - 55. Establishment of the Deposit Guarantee FundProvision

Establishes the Deposits Guarantee Fund, vests it in a Board of Trustees appointed under section 56, and requires the Board to invest the Fund's moneys in government securities and deposits with banks as directed.

Section 55. Establishment of the Deposit Guarantee Fund Section 55(1) There is hereby established a Fund to be known as the Deposits Guarantee Fund. Section 55(2) The Deposit Guarantee Fund shall vest in a Board of Trustees appointed under section 56 . Section 55(3) The moneys constituting the Deposit Guarantee Fund shall be invested by the Board of Trustees in government securities and in deposits with banks as directed by the Board of Trustees.
Section 55Verify source
§ 56THE DEPOSIT GUARANTEE FUND - 56. The Board of TrusteesProvision

Section 56 establishes a Board of Trustees and sets out its membership and three functions: oversight, managing/applying the Deposit Guarantee Fund, and levying contributions.

Section 56. The Board of Trustees Section 56(1)(a) the Chairperson who shall be elected from among the members appointed under subsection (2)(b) and (f); Section 56(1)(b) the Chairperson of the Board of the Authority; Section 56(1)(c) the Principal Secretary to the National Treasury or his representative; Section 56(1)(d) the Governor of Central Bank or his representative; Section 56(1)(e) the Commissioner or his representative; Section 56(1)(f) four members nominated by Sacco societies and appointed by the Cabinet Secretary; Section 56(1)(g) the chief executive officer of the Authority who shall be an ex officio member and secretary to the Board of Trustees. Section 56(2) The Cabinet Secretary shall by regulations provide for the manner of nominations under subsection (2)(f). Section 56(3)(a) provide oversight function in the management of the Deposit Guarantee Fund; Section 56(3)(b) manage and apply the Deposit Guarantee Fund in accordance with this Act; Section 56(3)(c) levy contributions for the Deposit Guarantee Fund in accordance with this Act.
Section 56Verify source
§ 57THE DEPOSIT GUARANTEE FUND - 57. Remuneration etc, and conduct of affairs of Board of TrusteesProvision

The Board of Trustees must pay its members remuneration or allowances for expenses from the Deposit Guarantee Fund after consulting the Cabinet Secretary, and must regulate the conduct of its affairs.

Section 57. Remuneration etc, and conduct of affairs of Board of Trustees Section 57(1) The Board of Trustees shall pay its members such remuneration or allowances for expenses out of the Deposit Guarantee Fund as it may determine after consultation with the Cabinet Secretary. Section 57(2) The Board of Trustees shall regulate the conduct of its affairs. [Act No. 16 of 2018 , s. 2.]
Section 57Verify source
§ 58THE DEPOSIT GUARANTEE FUND - 58. Sources of the Deposit Guarantee FundProvision

Sacco societies contribute moneys to the Deposit Guarantee Fund in accordance with section 60.

Section 58. Sources of the Deposit Guarantee Fund Section moneys contributed to the Deposit Guarantee Fund by Sacco societies in accordance with section 60 ;
Section 58Verify source
§ 59THE DEPOSIT GUARANTEE FUND - 59. Protection of depositsCommencement

The Deposit Guarantee Fund must protect members' deposits (not shares) up to one hundred thousand shillings per member; rules cover claims on insolvency, Board powers on claims and inspections, and time limits for creditor claims.

Section 59. Protection of deposits Section 59(1) The Deposit Guarantee Fund shall provide protection for members' deposits, but not shares, up to an amount of one hundred thousand shillings in respect of each member. Section 59(2) The amount being the aggregate credit balance of any accounts maintained by the member to a Sacco society, less any liability of the member to the Sacco society, shall be a protected deposit. Section 59(3) A member's deposits shall be used to offset any liabilities owed by the Sacco society under liquidation including any liability under a loan guarantee by such member. Section 59(4) If a member has outstanding loans or credit facilities owing to a Sacco society. the member or guarantor's deposits as the case may be, shall offset the loan or credit facility before the member or guarantor may receive any net from the members' or guarantors' protected deposits; Section 59(5) A member of a Sacco society may upon the society becoming insolvent, lodge a claim with the Authority, in such form as the Authority may approve, for payment to him out of the Deposit Guarantee Fund of any protected deposits which he would but for the insolvency, have been paid had he demanded from the insolvent society. Section 59(6) The Board of Trustees may, before paying any claim lodged under subsection (3) require the claimant to furnish such documentary proof to support such claim as may be prescribed by the Authority. Section 59(7) The Board of Trustees may refuse to make any payments to any person who in its opinion had any responsibility for, or may have benefited directly or indirectly from the circumstances leading to, the Sacco society becoming insolvent. Section 59(8) The Board of Trustees may at any time cause inspection to be carried out to ascertain the type, number and value of the protected deposits in any Sacco society. Section 59(9) Upon payment of protected deposits from the Deposit Guarantee Fund, the Board of Trustees shall be entitled to receive from the Sacco society or its liquidator, as the case may be the amount paid from the Deposit Guarantee Fund. Section 59(10)(a) a claim for payment of a protected deposit by a creditor of a Sacco society shall not be brought after the expiry of two years from the date of publication of commencement of such payment by the Board of Trustees; Section 59(10)(b) a claim for payment of a dividend by a creditor of Sacco society shall not be brought after the expiry of one year from the date of commencement of such payment by the Board of Trustees. Section 59(11) Subsection (10) shall not apply to a person who has, for reasons beyond his control and to the satisfaction of the Board of Trustees, been unable to make his claim within the said period.
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§ 60THE DEPOSIT GUARANTEE FUND - 60. Contribution to the Deposit Guarantee FundOffence

Every Sacco society must contribute to the Deposit Guarantee Fund by paying an annual amount and at times determined by the Board of Trustees in consultation with the Cabinet Secretary; the Board must serve notice specifying amount and a payment period (not later than 21 days from service), a late-paying Sacco must pay penalty interest not exceeding 0.5% per day, and the Board may increase contributions beyond gazetted maximums if a Sacco's affairs are detrimental.

Section 60. Contribution to the Deposit Guarantee Fund Section 60(1) Every Sacco society shall be a contributor to the Deposit Guarantee Fund and shall pay into the Deposit Guarantee Fund such annual amount, and at such times, as the Board of Trustees may determine in consultation with the Cabinet Secretary from time to time by order published in the Gazette . Section 60(2) The Board of Trustees shall serve on every Sacco society a notice specifying the amount and the period, which shall not be later than twenty-one days after the date of service of the notice, within which the amount shall be paid into the Deposit Guarantee Fund by the Sacco society. Section 60(3) A Sacco society which, for any reason, fails to pay its contribution to the Fund within the period specified in a notice issued under subsection (2) shall be liable to pay to the Fund a penalty interest charge not exceeding one half per cent of the unpaid amount for every day outside the notice period on which the amount remains unpaid. Section 60(4) If it appears to the Board of Trustees that the affairs of a Sacco society are being conducted in a manner detrimental to its own interests or to the interests of its members, the Board of Trustees may increase the contributions of that Sacco society beyond the maximum amounts gazetted. [Act No. 16 of 2018 , s. 2.]
Section 60Verify source
§ 61THE DEPOSIT GUARANTEE FUND - 61. Annual reportProvision

The Board of Trustees must, within three months after the close of each financial year, submit to the Cabinet Secretary a report on the operations of the Deposit Guarantee Fund for that year.

Section 61. Annual report Section The Board of Trustees shall, within three months after the close of each financial year, submit to the Cabinet Secretary a report on the operations of the Deposit Guarantee Fund for that year. [Act No. 16 of 2018 , s. 2.]
Section 61Verify source

Part VII

MISCELLANEAOUS

§ 62MISCELLANEAOUS - 62. Declaration of holidaysProvision

The Authority may declare, by Gazette notice, a non-public-holiday to be a holiday for all or a particular Sacco society, and the specified Sacco societies shall remain closed on that day.

Section 62. Declaration of holidays Section Where the Authority considers that it is in the public interest that all Sacco societies, or a particular Sacco society should remain closed on a day which is not a public holiday, the Authority may, by notice in the Gazette , declare that day to be a holiday for all Sacco societies or for that particular Sacco society, and all Sacco societies or that a particular Sacco society, as the case may be, shall remain closed on that day.
Section 62Verify source
§ 63MISCELLANEAOUS - 63. Orders by the High CourtProvision

The High Court may issue an order prohibiting a Sacco society from carrying on the deposit-taking business.

Section 63. Orders by the High Court Section prohibiting the Sacco society from carrying on the deposit-taking business; or
Section 63Verify source
§ 64MISCELLANEAOUS - 64. Default by officersProvision

Officers must take all reasonable steps to secure that the Sacco society complies with this Act and regulations made under it.

Section 64. Default by officers Section take all reasonable steps to secure the compliance of the Sacco society with this Act or regulations made under this Act;
Section 64Verify source
§ 65MISCELLANEAOUS - 65. Miscellaneous offencesOffence

Text: "with intent to deceive, falsifies any books of account, report, statement, record or other document of the society;"

Section 65. Miscellaneous offences Section with intent to deceive, falsifies any books of account, report, statement, record or other document of the society;
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§ 66MISCELLANEAOUS - 66. General penalty.Offence

Bodies corporate and specified persons (directors, committee members, employees or agents of a Sacco society or person) who commit the offence are guilty and subject to fines (up to 100,000 shillings); specified persons may instead or additionally face at least 12 months' imprisonment. A person charged may defend by proving lack of awareness or that all reasonable steps to prevent the contravention were taken.

Section 66. General penalty. Section 66(1)(a) if it is a body corporate, it shall be guilty of an offence and liable to a fine not exceeding one hundred thousand shillings; and Section 66(1)(b) every director, committee member, employee or agent of a Sacco society or person shall be guilty of an offence and liable to a fine not exceeding one hundred thousand shillings or to imprisonment for a term of not less than twelve months or to both such fine and imprisonment. Section 66(2) It shall be a defence to a person charged with an offence under this section to prove that he was not aware that the contravention was taking place or was intended or about to take place, or that he took all reasonable steps to prevent the contravention.
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§ 67MISCELLANEAOUS - 67. Application of the Co-operative Societies Act, 1997Provision

The Co-operative Societies Act (Cap. 490) applies to a Sacco society carrying out deposit-taking business under this Act where the matter is not dealt with in this Act; where there is a conflict, this Act takes precedence; disputes arising out of Sacco business under this Act shall be referred to the Tribunal.

Section 67. Application of the Co-operative Societies Act, 1997 Section 67(1) For greater certainty, the provisions of the Co-operative Societies Act ( Cap. 490 ) shall apply to a Sacco society carrying out deposit-taking business under this Act with respect to any matter, to the extent that the matter in question is not dealt with in this Act. Section 67(2) In the case of a conflict between the provisions of this Act and the provisions of the Co-operative Societies Act ( Cap. 490 ) with respect to Sacco societies to which this Act applies, the provisions of this Act shall take precedence. Section 67(3) All disputes arising out of Sacco business under this Act shall be referred to the Tribunal.
Section 67Verify source
§ 68MISCELLANEAOUS - 68. RegulationsProvision

The Cabinet Secretary must make regulations (in consultation with the Authority) to carry out this Act, and may (after consultation with the Authority) make regulations for licensing and supervising Islamic-compliant deposit-taking SACCOS.

Section 68. Regulations Section 68(1) The Cabinet Secretary shall, in consultation with the Authority, make regulations generally for the better carrying out of the provisions of this Act. Section 68(2) Despite the generality of subsection (1), the Cabinet Secretary may, after consultation with the Authority make regulations providing for the licensing and supervision of SACCOS carrying out deposit taking business in compliance with Islamic law. [Act No. 15 of 2017 , s. 54, Act No. 16 of 2018 , s. 2.]
Section 68Verify source
§ 69MISCELLANEAOUS - 69. Transitional provisionsCommencement

A Sacco society carrying out deposit-taking business when this Act starts must apply for a licence under this Act within twelve months (or a shorter period if prescribed by the Cabinet Secretary in the Gazette).

Section 69. Transitional provisions Section A Sacco society which at the commencement of this Act, is carrying out deposit-taking business to which this Act applies shall, within twelve months from the date of commencement, or such shorter period as the Cabinet Secretary may, by notice in the Gazette prescribe, apply for a licence under this Act. [Act No. 16 of 2018 , s. 2.]
Section 69Verify source

Legislative relationships

9 referenced instruments

Names are derived from the stored provision headings and citation-enrichment layer. Treat this as a research index and verify each relationship against the source text.

A–F

6 instruments

  • Authority incurred by the authority in the discharge of its functions under this Act

    Section 16

  • Authority Section license Sacco societies to carry out deposit-taking business in accordance with this Act

    Section 5

  • Authority shall be audited and reported upon in accordance with the Public Audit Act

    Section 20

  • Authority under this Act

    Section 8

  • Co-operative Societies Act

    Section 27

  • Co-operative Societies Act, 1997

    Section 67

N–S

3 instruments

  • Sacco societies to which this Act

    Section 48

  • Sacco societies under this Act

    Section 22

  • Sacco society with this Act

    Section 64

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