By Faith Lagat
A post by X user @jmuragengunjiri, shared and discussed on social media platforms including Facebook and X, claims that President William Ruto’s government plans to use more than Ksh 1 trillion held by Savings and Credit Cooperative Societies (SACCOs) to help finance major development projects.
The post claims that the move is set to be backed by the new Cooperatives Bill. Similar claims have circulated, often accompanied by graphics and commentary suggesting the government intends to tap SACCO savings for the National Infrastructure Fund (NIF), sparking significant anxiety among SACCO members.
The post by @jmuragengunjiri, whose account typically posts updates and commentary on Kenyan politics, government policies, economic issues, and current affairs with a critical or direct tone, received engagement through likes, reposts, quotes, and replies, reflecting high interest and concern from audiences following political and financial matters. Similar alarmist or interpretive posts on the topic have gone viral, prompting concern among members about the safety of their savings and sparking cross-platform discussions.
The claim was also shared here and here.
Background
Savings and Credit Cooperative Societies (SACCOs) are member-owned financial cooperatives in Kenya that mobilize savings from members and provide affordable credit for education, housing, farming, business, and personal needs. They play a critical role in financial inclusion, particularly for middle- and lower-income Kenyans, rural communities, and those underserved by commercial banks. Kenya’s SACCO sector is one of the largest and most vibrant in Africa, with close to 8 million members and collective assets and deposits exceeding Ksh 1 trillion.
SACCO operations differ fundamentally from conventional banks or investment pools. Members deposit savings, which SACCOs primarily lend out to other members as loans. The deposit-to-loan ratio in many SACCOs is often close to 1:1 or highly utilized, meaning the funds are not held as idle cash but are actively recirculated within the economy through member borrowing. This model provides accessible credit at competitive rates while generating returns (dividends or interest rebates) for savers.
SACCOs are regulated (larger ones by the Sacco Societies Regulatory Authority – SASRA), with requirements for capital adequacy, liquidity management, governance, and member protections, including the Deposit Guarantee Fund, which safeguards deposits up to a specified limit in the event of institutional failure.
The longstanding framework emphasizes member ownership and control. Funds belong to the members and are managed by the elected officials of each autonomous cooperative society. Government involvement has historically focused on regulation, supervision, and sector development rather than direct access to deposits.
The proposed Sacco Societies (Amendment) Bill (often referred to in discussions as the Cooperatives Bill or SACCO Amendment Bill) seeks to modernize and strengthen the sector. Key provisions include improving governance, transparency, and accountability; embracing digital technology for efficiency; establishing a Central Liquidity Facility to enable SACCOs to support each other through short-term lending and better liquidity management; introducing a Shared Services Framework for pooled resources, reduced operational costs, and modern financial technologies; strengthening the Deposit Guarantee Fund for enhanced member protection; and creating a centralized data system for better oversight and supervision. These reforms aim to boost confidence, financial stability, and efficiency while keeping decision-making and fund management at the cooperative level. There is no provision for government seizure, compulsory transfer, or direct use of member deposits.
Separately, the National Infrastructure Fund (NIF) was established under the National Infrastructure Fund Act, 2026. Its purpose is to scale up catalytic national infrastructure in sectors such as transport (highways, railways, ports, airports), energy, water, irrigation, digital connectivity, and agriculture. The Fund mobilizes capital from diverse sources, including privatization proceeds, parliamentary appropriations, equity investments, debt instruments, public-private partnerships (PPPs), pension funds, collective investment schemes, sovereign wealth funds, climate finance, and capital markets. It is designed to reduce reliance on public debt for commercially viable projects. Governance is through a Board of Directors (with independent directors recruited competitively), a Chief Executive Officer, and specific investment policies, feasibility studies, performance evaluation, and reporting requirements. The sources of funds explicitly listed do not include SACCO member deposits.
Discussions around infrastructure financing have occasionally touched on the potential for institutional investors (including mature cooperatives in other countries) to participate voluntarily in projects or government securities when returns are attractive, similar to how pension funds operate. However, any such participation would be investment-driven and subject to SACCO governance, not a government directive to access or redirect members’ savings.
Concerns over the claim were amplified by remarks from figures such as Safina Party leader Jimi Wanjigi, who warned on social media about the government “coming for your SACCO monies,” and by the circulation of a doctored graphic falsely attributing a quote to Treasury Cabinet Secretary John Mbadi suggesting the use of SACCO funds.
These elements, combined with the ongoing public debate about the Cooperatives Bill and infrastructure needs, fuelled widespread anxiety, with some members reportedly inquiring about or threatening to withdraw their savings.
Verification
Piga Firimbi reviewed official statements from the State Department for Cooperatives, the National Treasury, and related government communications around July 6, 2026 (Ushirika Day and subsequent clarifications).
Principal Secretary Patrick Kilemi (State Department for Cooperatives) explicitly stated that SACCO deposits belong to members and are managed exclusively by the elected officials of the respective societies.
He affirmed:
“SACCO funds remain the property of the respective SACCOs and are managed exclusively by the elected officials. The Government of Kenya has no access to, nor does it intend to utilise, these funds.”
He further explained the operational model, noting that SACCOs do not keep deposits idle but lend them out, with deposit-to-loan ratios often close to one-to-one, making any notion of large-scale idle funds available for government use inaccurate.
The National Treasury, under Cabinet Secretary John Mbadi, dismissed the circulating social media claims and a fabricated graphic as “entirely fake and malicious.” The Treasury clarified that CS Mbadi made no such statement and urged the public to ignore the misinformation and rely on official channels. It emphasized that the NIF is financed through legally established sources such as parliamentary allocations, grants, concessional loans, investment returns, and privatization proceeds.
No official announcements, circulars, or provisions in the Cooperatives Bill or the National Infrastructure Fund Act authorize the government to access, borrow, or redirect SACCO member deposits. The Cooperatives Bill focuses on sector modernization and member protections.
The National Infrastructure Fund Act details specific funding mechanisms without reference to SACCO savings. Government officials, including those from the Ministry of Cooperatives, reiterated that any future voluntary investment by SACCOs in infrastructure (e.g., via bonds) would be market-driven, under cooperative control, and not a compulsory measure.
Checks of official government websites, ministry statements, parliamentary records of the Bills, and public clarifications confirm the absence of any plan to “use” SACCO deposits in the manner claimed.
Verdict
The claim that the government is planning to use over Ksh 1 trillion held by SACCOs to finance major development projects through the new Cooperatives Bill is FALSE.
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