NEW NON-DEPOSIT TAKING SACCOs
REGULATIONS, 2020 FREQUENTLY ASKED QUESTIONS (FAQs)
Ql: What’s a SACCO?
A: A SACCO stands for Savings and Credit Cooperative which is a special type of co-operative offering financial services with a primary focus on mobilisation of funds and provision of affordable credit to its members who are both the owners and users.
Q2: What is a Non- Deposit Taking SACCOs and how does it operate?
A: The non-DT -SACCOs are SACCOs that mobilise savings from their members, and these savings are strictly utilized as collateral for credit facilities advanced to its members. These deposits are not withdrawable by the members but can only be refunded when the members exit the SACCO. The non-deposit taking Saccos do not offer front office services as members do not hold accounts where they deposit or withdraw money.
Q3: What is BOSA?
A: Back Office Services Activity. Funds in BOSA are NOT withdrawable unless the member of a non-deposit taking SACCO takes a loan or withdraw from th£ Sacco to access his/her funds
Q4: Which Non-Deposit Taking (NDT) SACCOs will be regulated under the new regulations?
A: Non-Deposit Taking SACCOs currently holding members’ deposits amounting to or over KShlO0 million; those that mobilise membership and share capital through digital platforms or other electronic payment platforms (popularly known as virtual or digital SACCOs); and those that mobilise members and subscription to its share capital from persons who are ordinarily resident outside Kenya.
Q5: Who is SASRA and what’s its role/mandate?
A: SASRA stands for the SACCO Societies Regulatory Authority. The institution was incorporated in 2010 under the legal framework of the SACCO Societies Act No. 14 of 2008. SASRA is the government’s principal agency responsible for the supervision and regulation of SACCO Societies in Kenya.
Q6: Who has given SASRA authority to supervise Non-Deposit Taking?
A: SASRA was mandated by the government in accordance with the new Non-Deposit Taking SACCO Regulations, 2020 to license, regulate and supervise Non- Deposit Taking (BOSA)SACCOs.
Q7: When did the Non- Deposit Taking Saccos Regulations take effect?
A: The new Non- Deposit Taking SACCO Regulations, 2020 took effect on the 1st January 2021 and all SACCO Societies undertaking the specified non-deposit taking (BOSA) business are required to comply with the same.
Q8: What does the Non- Deposit Taking SACCO need for application of authorisation?
A: The following information is required for application for licensing:
- Name of the SACCO Society.
- The members of the SACCO society’ supervisory committee
- The SACCO society’s chief executive office
- A copy of the SACCO society’s registration certificate
- A copy of the SACCO society’s by-laws
- A three-year business plan and feasibility study of the SACCO society
- A certified extract of minutes of the general meeting resolution authorizing the SACCO society to carry on specified non-deposit taking business
Certified copies of the SACCO soc ety’s audited financial statements for the preceding three years, where applicable
- Evidence that the SACCO has adequate capital; and
- A non-refundable application fee of three thousand shillings.
Q9: After acquiring all the necessary documents, what steps are required by the Non- Deposit Taking SACCO to register with SASRA?
A: One can download the step by step guidance note and a detailed Non-DT SACCO Data collection template provided under the “Non-Deposit Taking SACCOs” section in the Resources Menu of SASRA’s website www.sasra.go.ke or upon request in writing to the Authority via email policy@sasra.go.ke.
Ql0: What happens upon receipt of the application for authorisation and satisfying itself that the SACCO has met conditions contained in Regulations, 2020?
A: The Authority (SASRA) shall visit the SACCO’s premises for an onsite inspection with a view to establishing if the SACCO has put in place:
- appropriate institutional infrastructure, including adequate working space;
- a management Information System for the purpose of performing and accounting for all transactions and providing the minimum reports required by Authority; and suitable organisational , governance and management structures
Q11: What is the registration fee?
A: In accordance with the Regulations 2020, the application for authorisation shall be accompanied by the application processing fee of Kshs 3,000/-
Payment of this fee can be deposited into the Authority’s Bank Account held at the Co-operative Bank of Kenya, Account No. 01120161308700, Upper Hill Branch, Nairobi.
Consequently, the Authority will not consider an application for authorisation unless the SACCO has attached a payment bank deposit slip showing the said sum of Kshs 3,000/-The name of the NOT SACCO making the deposit, alongside its registration (CS) number should be clearly stated in the deposit slip.
Q12: Does SASRA issue an authorisation certificate? If yes, what is its duration?
A: Yes, SASRA issues a valid annual certificate which is renewable, annually, unless it is revoked under the new Act and Regulations, 2020.
Q13: What is the renewable fee?
A: A Non-Deposit Taking Sacco shall not later than the 30th November of every year submit to the Authority an annual authorisation renewal fee of Kshs 30,000/- for the SACCO society’s Head Office; an annual authorisation renewal fee of Kshsl0,000/- for each of the SACCO Society’s authorised places of business; and the SACCO society’s annual data and information specifying the operations and performance of the SACCO Society in such form as the Authority may require.
Ql4: What happens if application for authorisation has been rejected but payment had already been remitted by the NOT SACCO?
A: The fee paid shall be deemed spent; and whereas the SACCO may make another application for authorisation, such new application shall be accompanied with evidence of payment of another application fee of Kshs 3,000/-
Q15: What is the deadline for a Non- Deposit Taking SACCO to register with SASRA?
The Non-Deposit Taking SACCOs have until 30th June 2021 to comply with the new regulations
Q16: What happens if a Non-Deposit Taking Sacco is not compliant with the stipulated timeline for registration?
A: The Non-Deposit Taking SACCO who fails to register breaks the law and the Authority will take stringent actions against it by:
- Issuing an order prohibiting the SACCO society from taking any further non-withdrawable deposits from the date of the order.
- Notifying the public and employers to cease making remittances of non-withdrawable deposits to the Sacco Society.
Direct Bankers and other payment service providers to cease receiving funds on the accounts of or on behalf of the Sacco Society