Mombasa: The government is working to ensure that cooperatives can access favourable credit facilities while building capacity to manage debt effectively. Speaking in Mombasa during a cooperative leader conference, the Cabinet Secretary for Cooperatives and Micro Small and Medium Enterprises (MSME) Development, Wyclifee Oparanya, announced a series of reforms aimed at strengthening the cooperative sector.
According to Kenya News Agency, one key reform is the introduction of a Deposit Guarantee Fund as part of the proposed amendments to the SACCO Societies ACT. Oparanya highlighted that the fund will help in protecting members' savings, enhance financial stability, and strengthen confidence in the cooperative sector. Additionally, the integration of digital lending platforms is set to offer secure, efficient, and accessible financial services, especially in underserved regions.
In an effort to ensure effective risk management, Oparanya emphasized the government's commitment to equipping cooperatives with the necessary tools and knowledge to manage financial and operational risks smoothly. He noted that by adopting sound financial management practices, cooperatives will be better prepared to navigate market fluctuations, inflation, and other economic challenges.
Oparanya further underscored the importance of embracing technology for competitiveness, stating that the government remains dedicated to supporting the digital transformation of cooperatives through mobile banking loans and other digital financial products. However, he reiterated the need for prioritizing cybersecurity to protect members' data and assets.
The ministry has announced preparations to celebrate the International Year of Co-operatives 2025 in July. Addressing the media at the Cooperatives Insurance Company (CIC) Group national cooperatives leaders' summit 2025, Oparanya mentioned that the United Nations has declared 2025 as a year of cooperatives, prompting governments to focus on the corporate model of development.
During the event themed 'promoting sustainable cooperative enterprises', discussions centered around challenges facing the cooperative sector, including governance and policy reforms. The CS stressed the importance of collaboration with industry stakeholders to maintain robust cybersecurity practices and encouraged cooperatives to leverage the East African Community for cross-border business expansion.
Oparanya urged stakeholders to treat cooperation as a business, invest in it for profit, and focus on MSMEs as a means to create jobs and support economic growth. He highlighted the government's readiness to support cooperatives in collaboration with the three branches of government and encouraged education for better understanding and support.
He also cited Uganda's successful embrace of the cooperative movement at the village level as an example for Kenya to follow. The ministry aims to ensure proper legislation and policies to strengthen the sector and align with the government's Bottom-up economic transformation agenda by empowering grassroots communities.
The CS mentioned reforms in the Cooperatives Society Bill 2024, which aim to reduce educational and competence requirements for cooperative leaders, thus facilitating broader participation and leadership within the sector. The introduction of the Deposit Guarantee Fund will further protect members' savings and enhance financial stability.