Kenyan Savings and Credit Co-operative Societies (Saccos) are moving closer to the implementation of an inter-Sacco lending market and eventual integration into the National Payments and Clearing system in a development, leaving commercial banks staring at close to Ksh2.33 billion ($21.37 million) loss in interest income on loans granted to the co-operative sector.
The Sacco Societies Regulatory Authority (Sasra), working with a multi-agency team comprising the State Department of Co-operatives, the National Treasury, Central Bank of Kenya (CBK) and the Kenya Law Reform Commission (KLRC), has drafted the legal framework for the operationalisation of the Central Liquidity Fund (CLF) where Saccos can lend and borrow money from each other thereby severing ties with Commercial banks whose loans are considered ‘expensive.’
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