The Nairobi Securities Exchange (NSE) is collaborating with key stakeholders in the co‑operative sector to establish the infrastructure and guiding principles needed for Sacco listings, marking a significant step in the bourse’s bid to draw more than seven million Sacco members into capital markets trading.

In November last year, the NSE announced plans to facilitate the listing of savings and credit co‑operatives (Saccos) on the stock market to stimulate trading and unlock millions of dollars in share capital forfeited by former members. These funds are currently non‑refundable and can only be transferred to existing members.

The NSE is banking on Saccos and table-banking groups (chamas), whose membership spreads across the country, to achieve a targeted nine million investor base by 2029.

Sacco membership more than doubled in 10 years to 7.39 million in 2024 from 3.08 million in 2014, according to the latest data from the Sacco Societies Regulatory Authority (Sasra).

Mr Kiminje says listed Saccos will require a trading environment where the rights of the members are respected and which ensures trading happens in line with the co‑operative principles.“I’m happy with the progress so far. We are moving towards a consensus with stakeholders of the co‑operative movement to come up with a mechanism of transferring share capital from one person to another. We want a project that addresses the needs of all the stakeholders in the co‑operative sector,” he says.

If successful, the listing of Saccos on the NSE would give former Sacco members and those intending to terminate their membership an opportunity to sell their stake in an open market and at a competitive price determined by market forces of supply and demand.

The Kenya Association of Stockbrokers and Investment Banks (Kasib) says listing of saccos on the stock market would enhance their brand visibility and transparency in their governance structures.“KASIB has for a long time engaged the sacco industry to encourage them to list on the NSE. This would not only provide a much needed exit strategy for sacco members but shall also enhance brand visibility and transparency in their governance. We welcome listing of saccos on the exchange,” Kasib said in a statement.

The stakeholders will determine the manner of the listing, given that Saccos are not corporate entities limited by shares as required by the Kenyan capital markets listing rules.

Sacco rules require members to buy shares to build equity, which is non‑refundable and can only be transferred to existing members, and not freely traded on a public exchange.

This has exposed exiting members to loss of their share capital locked in Saccos, with the amounts accumulating into millions of dollars over the years.

According to the NSE, the listing of Saccos would yield a fair pricing mechanism that takes into consideration the duration a member has invested, the growth of the Sacco over time, and price discovery through demand and supply anchored on the performance of the Sacco, its governance, and transparency in the trading of the shares.

Currently, Saccos are not qualified to list on the NSE by virtue of not being corporate entities limited by shares and registered under the Companies Act.

The Capital Markets Authority (CMA) requirements stipulate that institutions seeking to list on the stockmarket must be companies limited by shares and registered under the Companies Act.

Saccos are registered under the Co‑operative Societies Act.

The discussions over the listing of Saccos have largely involved the Ministry of Co‑operatives, the Capital Markets Authority, Sasra, Sacco members through their various associations, and the chief executives, chairpersons and chief finance officers (CFOs), aimed at convincing Saccos to agree on the listing of their shares on the bourse.

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