Kenya’s Sacco Societies Regulatory Authority (Sasra) has barred five credit unions from taking deposits from the public.
This is after revoking their licences over serious liquidity problems and other corporate governance challenges.
According to the Business Daily, among the deregistered sacco is Ufundi, Transcom, Nest Sacco, Green Hills Sacco (formerly Chebosobon) and Maono Daima.
“They had liquidity challenges and were unable to meet obligations such as paying members deposits when due,” said Sasra chief executive John Mwaka.
He added that the affected saccos must revert to offering back office services only and immediately cease offering banking-like services popularly known as front office services.
Mwaka said the regulator had noted serious corporate governance lapses at the affected saccos and directed them to terminate services such as salary processing, operating savings and current accounts, automated teller machine (ATM) services, mobile banking, and money transfer services.
Business Daily says a total of nine saccos have been deregistered since 2014.
It adds that the five deregistered saccos have a combined membership of 18,769 savers, Sh1.9 billion in assets, Sh641million in deposits and a loan book of Sh517 million.
The five Saccos will now be under the jurisdiction of the Commissioner for Co-operative Development after the licence withdrawal.