The Sacco Societies Regulatory Authority (Sasra) has launched an investigation into the consistent increase in the number of dormant members over the years, as the figure now inches closer to two million.
While the number of active members and total membership is also increasing, the rate at which dormant members are accumulating is higher, informing Sasra’s intention to investigate the cause.
In the latest report by the sacco regulator, the number of dormant members is growing at almost three times that of active members. This means for every new member who joins a sacco, three become inactive.
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The Sacco Societies Supervision Report 2024 shows that the total membership of regulated saccos as at December 2024 stood at 7.4 million. Of these, 5.7 million were active while 1.7 million were dormant.
The report also shows that while the year-on-year change in active membership is 6.02 per cent, for dormant members is 15.09 per cent.
The number of active members was 4.82 million in 2021, which grew to 5.2 million in 2022, 5.39 million in 2023 and 5.72 million in 2024. This is while dormant membership, which was at 1.18 million in 2021, grew to 1.22 million in 2022 and further to 1.45 million in 2023. It surged to 1.67 million in 2024.
For Deposit-Taking Saccos (DT-Saccos), the year-on-year growth of dormant members is 12.16 per cent, while for Non-withdrawable Deposit-Taking Saccos (NWDT-Saccos), this growth is 41.36 per cent.
DT-Saccos had 1.46 million dormant members as of December 2024, while NWDT-Saccos had 205,386. The report shows the latter segment also recorded a drop in members, represented by a year-on-year growth of -18.50 per cent.
“The decline in the membership of NWDT-Saccos is explainable by the change in the business model of three formerly NWDT-Saccos to DT-Saccos, and which also explains the sharp increase in the membership of DT Saccos in 2024,” the report says.
The report says the total active members were 5.72 million in 2024, compared to 5.39 million members who were considered active in 2023.
The proportion of active members, therefore, was 77.44 per cent in 2024, a slight decline from the proportion of active members in 2023, which was reported at 78.85 per cent.
“Conversely, there was an increase in the dormant membership to 1.66 million members, which represented 22.56 per cent of the entire population of membership,” Sasra says in the report.
“The high proportion of dormant members in the regulated saccos industry calls for concerted efforts aimed at reactivating such members, including through development and rolling out of suitable financial products and services.”
Sasra Acting Chief Executive David Sandagi said the methodology Saccos use to entice membership sometimes does not automatically lead to retention.
He says the methodology seems to attract individuals to a certain product or service, yet for them to take advantage of the same, they need to be members for a certain period. For most Saccos, this is three months.
“Whereas right from the onset, there is a heavy influx of membership, their ability to fully transact and access the full bouquet of products and services is consequent to their duration of being with the Sacco as a member,” he said during the launch of the report.
He added that there are instances where the type of products and services saccos come up with may not necessarily fit the direct needs of the members. This then informs the need for some members to step back.
“Right from the onset, as they (saccos) craft products and services, they first need to do a gap assessment as to what exactly their members require to enable them to patronise these products and services,” he said.
Sandagi said the authority is currently undertaking a demographics survey to gather more details on the dormant members to ascertain the products or services that lead to them being inactive.
“That is work that is ongoing and we will be able at the right time to share this survey,” he said.
So far, he pointed out, it is difficult to tell if the prevailing economic times are playing a role.
“It is a host of factors. It could be, perhaps, because of the thinning of disposable income given certain macro-economic variables, but definitely I would not want to say that until we are able to get that data consistently to inform whether, in addition to the methodology, and how products and services are formatted, then this could be one of the issues,” he said.
According to the report, the DT-Saccos segment had the highest number of members at 6.87 million members, an increase of 8.76 per cent in 2024 from a membership base of 6.32 million members in 2023.
This accounted for 93.03 per cent of all the members of regulated saccos – underscoring the criticality of the DT-Saccos segment to the regulated Saccos industry.
The NWDT-Saccos segment had a total membership of 514,671 in 2024, a marginal decline from a membership base of 524,776 in 2023, representing 6.97 per cent of the total membership.
The report states that despite the decrease in the number of regulated saccos, mainly through revocation of licenses or authorisation, the total number of memberships of regulated saccos has continued to grow.
For instance, the report says two saccos had their authorisation certificates revoked in 2024 and in 2023, respectively, yet the membership for regulated saccos increased during the period from 6.42 million members in 2022 to 6.84 million members in 2023, and to 7.39 million members in 2024.
“It is therefore apparent that revocation of licenses or authorisation certificates of failed regulated saccos has very little or no impact on the overall membership growth,” the report says.
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The Sacco Societies Regulatory Authority (Sasra) has launched an investigation into the consistent increase in the number of dormant members over the years, as the figure now inches closer to two million.
While the number of active members and total membership is also increasing, the rate at which dormant members are accumulating is higher, informing Sasra’s intention to investigate the cause.
In the latest report by the sacco regulator, the number of dormant members is growing at almost three times that of active members. This means for every new member who joins a sacco, three become inactive.
Follow The Standard
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The Sacco Societies Supervision Report 2024 shows that the total membership of regulated saccos as at December 2024 stood at 7.4 million. Of these, 5.7 million were active while 1.7 million were dormant.
The report also shows that while the year-on-year change in active membership is 6.02 per cent, for dormant members is 15.09 per cent.
The number of active members was 4.82 million in 2021, which grew to 5.2 million in 2022, 5.39 million in 2023 and 5.72 million in 2024. This is while dormant membership, which was at 1.18 million in 2021, grew to 1.22 million in 2022 and further to 1.45 million in 2023. It surged to 1.67 million in 2024.
For Deposit-Taking Saccos (DT-Saccos), the year-on-year growth of dormant members is 12.16 per cent, while for Non-withdrawable Deposit-Taking Saccos (NWDT-Saccos), this growth is 41.36 per cent.
DT-Saccos had 1.46 million dormant members as of December 2024, while NWDT-Saccos had 205,386. The report shows the latter segment also recorded a drop in members, represented by a year-on-year growth of -18.50 per cent.
“The decline in the membership of NWDT-Saccos is explainable by the change in the business model of three formerly NWDT-Saccos to DT-Saccos, and which also explains the sharp increase in the membership of DT Saccos in 2024,” the report says.
The report says the total active members were 5.72 million in 2024, compared to 5.39 million members who were considered active in 2023.
The proportion of active members, therefore, was 77.44 per cent in 2024, a slight decline from the proportion of active members in 2023, which was reported at 78.85 per cent.
“Conversely, there was an increase in the dormant membership to 1.66 million members, which represented 22.56 per cent of the entire population of membership,” Sasra says in the report.
“The high proportion of dormant members in the regulated saccos industry calls for concerted efforts aimed at reactivating such members, including through development and rolling out of suitable financial products and services.”
Sasra Acting Chief Executive David Sandagi said the methodology Saccos use to entice membership sometimes does not automatically lead to retention.
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He says the methodology seems to attract individuals to a certain product or service, yet for them to take advantage of the same, they need to be members for a certain period. For most Saccos, this is three months.
“Whereas right from the onset, there is a heavy influx of membership, their ability to fully transact and access the full bouquet of products and services is consequent to their duration of being with the Sacco as a member,” he said during the launch of the report.
He added that there are instances where the type of products and services saccos come up with may not necessarily fit the direct needs of the members. This then informs the need for some members to step back.
“Right from the onset, as they (saccos) craft products and services, they first need to do a gap assessment as to what exactly their members require to enable them to patronise these products and services,” he said.
Sandagi said the authority is currently undertaking a demographics survey to gather more details on the dormant members to ascertain the products or services that lead to them being inactive.
“That is work that is ongoing and we will be able at the right time to share this survey,” he said.
So far, he pointed out, it is difficult to tell if the prevailing economic times are playing a role.
“It is a host of factors. It could be, perhaps, because of the thinning of disposable income given certain macro-economic variables, but definitely I would not want to say that until we are able to get that data consistently to inform whether, in addition to the methodology, and how products and services are formatted, then this could be one of the issues,” he said.
According to the report, the DT-Saccos segment had the highest number of members at 6.87 million members, an increase of 8.76 per cent in 2024 from a membership base of 6.32 million members in 2023.
This accounted for 93.03 per cent of all the members of regulated saccos – underscoring the criticality of the DT-Saccos segment to the regulated Saccos industry.
The NWDT-Saccos segment had a total membership of 514,671 in 2024, a marginal decline from a membership base of 524,776 in 2023, representing 6.97 per cent of the total membership.
The report states that despite the decrease in the number of regulated saccos, mainly through revocation of licenses or authorisation, the total number of memberships of regulated saccos has continued to grow.
For instance, the report says two saccos had their authorisation certificates revoked in 2024 and in 2023, respectively, yet the membership for regulated saccos increased during the period from 6.42 million members in 2022 to 6.84 million members in 2023, and to 7.39 million members in 2024.
“It is therefore apparent that revocation of licenses or authorisation certificates of failed regulated saccos has very little or no impact on the overall membership growth,” the report says.
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By Graham Kajilwa