Saving in Saccos: Over 1.3 million Kenyans have stopped contributing to Savings and Credit Co-operative Societies also known as Saccos in the wake of a poorly performing economy and job losses. This is according to the latest data from the Sacco Societies Regulatory Authority (Sasra). The data shows that the number of savers who stopped saving monthly increased by 79.5 percent from 764,472 in 2019 to 1.372 million last year.
This saw Sacco members who are no longer active account for a quarter or 25.09 percent of the 5.4 million total membership compared to 16.95 percent reported in 2019.
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“The sharp increase in the dormancy of members may be attributed to the general impacts of the pandemic on the general economy, resulting in reduced member transactions with their respective DT-Saccos,” Sasra said in its annual report for 2020.
Data from the Kenya National Bureau of Statistics shows that up to 1.7 million Kenyans lost their jobs in three months to June 2020. The number of people in employment fell to 15.87 million between April and end of June 2020 compared to 17.59 million the previous quarter. In the three months to September 2020 about 15,547 workers aged between 55 and 59 years lost jobs.
The hardest hit sectors of the economy included export processing zones (EPZs), aviation, horticulture, tourism and hotels. Firms operating in export processing zones shed 8,135 jobs by June. 230,000 jobs in the tourism and hospitality sector were lost as businesses operated under minimum capacity or complete shutdown. Kenya’s economy contracted for the first time in almost 12 years in the second quarter of 2020.
However, the number of sacco members making regular savings in the 175 firms increased from 4.5 million to 5.4 million after the regulator licensed three new players, Ushuru, Kimisitu and Acumen.
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The total assets within the DT-Sacco system grew to reach Sh. 627.68 billion in 2020 from Sh. 556.71 billion recorded in 2019. Total deposits grew by 13.41 per cent to Sh. 431.46 billion in 2020 from Sh. 380.44 billion.
