Deposit-taking vs non-deposit-taking SACCOs in Kenya
SASRA licenses deposit-taking SACCOs by default — and pulls in non-deposit-taking SACCOs under three specific triggers. Here is exactly what those triggers are.
The default split
The SACCO Societies Act, 2008 applies in full to every SACCO carrying out deposit-taking business (Section 3(1)(a)). Section 23 requires a SASRA licence before any SACCO carries out deposit-taking business — a SACCO offering FOSA services (see BOSA vs FOSA) falls into this category.
A SACCO carrying out only non-deposit-taking business — BOSA activities, no FOSA window — sits outside SASRA's default reach and falls under the Commissioner for Cooperative Development instead, unless it's specifically pulled into SASRA's authorization regime by regulation (Section 3(1)(b)) — which is exactly what happened with the Sacco Societies (Non-Deposit-Taking Business) Regulations, 2020.
The three triggers that pull a non-deposit-taking SACCO into SASRA's regime
Under the 2020 Regulations (Regulation 4), a non-deposit-taking SACCO needs SASRA authorization if any of these apply:
- Non-withdrawable deposits reach KES 100 million. This is an automatic trigger — once a SACCO's non-withdrawable member deposits cross this figure, authorization is required.
- Membership or share-capital subscription is mobilized through digital or electronic payment platforms. Unlike the deposit threshold, this requires written SASRA approval before the SACCO starts mobilizing this way — it isn't something that triggers automatically once it happens; the approval has to come first, regardless of the SACCO's deposit size.
- Membership or share-capital subscription is mobilized from people ordinarily resident outside Kenya — a diaspora SACCO. Same pre-approval requirement as the digital-mobilization trigger.
A SACCO that doesn't meet any of these three conditions continues to operate as an ordinary non-deposit-taking cooperative under the Cooperative Societies Act, outside SASRA's authorization regime.
Why the distinction between "automatic" and "pre-approval" matters
The KES 100 million deposit trigger is something a SACCO can measure against its own books and know where it stands. The digital-platform and diaspora triggers work differently — SASRA's approval is required before a SACCO starts mobilizing membership that way, not after crossing a threshold. A SACCO planning to launch a digital membership channel or actively recruit diaspora members should treat SASRA authorization as a precondition of that plan, not a downstream compliance step to handle once volume grows.