What is Co-operative Society?

A co-operative society is an association of people registered under Kenyan co-operative law to meet common economic, social or cultural needs through a jointly owned and democratically controlled enterprise. Registration is administered under the Co-operative Societies Act. A SACCO is one kind of co-operative society, the kind whose business is savings and credit among its members.

A real Kenyan example

A dairy co-operative, a housing co-operative and a SACCO are all co-operative societies. Only the third takes member savings and lends them back to members.

Why it matters

The terms are used interchangeably in conversation and they are not interchangeable. A registration certificate proves a society exists as a co-operative; it says nothing about whether that society is authorised to take deposits, and nothing about its financial condition.

FAQs

Is every co-operative society a SACCO?
No. Co-operative societies cover many kinds of joint enterprise, including agricultural marketing, housing, transport and consumer co-operatives. A SACCO is specifically a savings and credit co-operative.
Who registers co-operative societies in Kenya?
Registration falls under co-operative law and is administered through the Commissioner for Co-operative Development and the relevant state department. This is separate from SASRA licensing, which applies to SACCOs within SASRA's mandate.
Does registration mean a society is financially sound?
No. Registration establishes legal existence and brings obligations under co-operative law. It is not a rating, an endorsement or a statement about financial health.
What governs how a co-operative society operates?
Co-operative law, the regulations made under it, and the society's own registered bylaws, which set out membership, governance, meetings and how surplus is dealt with.

Related terms

See all 72 terms