In Kenya, women make up a significant portion of the population actively owning and managing micro, small, and medium enterprises (MSMEs). Despite their contributions, women face significant barriers to accessing financial services, limiting their potential to scale up their ventures and achieve economic independence. Savings and credit co-operative societies (Saccos) have emerged as a transformative solution, providing women with access to affordable credit, financial literacy, and a supportive community to foster economic and social empowerment.
The role of Saccos in women’s empowerment
Saccos are uniquely positioned to empower women due to their community-focused model. Unlike conventional banks, Saccos prioritize the welfare of their members over profit. For many women, especially in rural and marginalized areas, they serve as the first point of access to credit and savings products.
Saccos in Kenya have developed tailored financial products specifically designed to meet the unique needs of women. These offerings include low-interest loans, group savings schemes, and flexible repayment terms, which have proven instrumental in transforming the lives of women across various communities. With access to these financial services, women have been able to start and expand businesses in diverse sectors such as agriculture, retail, and handicrafts, thereby fostering economic independence and creating employment opportunities.
Beyond entrepreneurship, these financial solutions enable women to invest in the education and healthcare of their families, contributing to long-term social and economic stability. Additionally, the access to affordable credit allows women to undertake home improvement projects, thereby enhancing their overall quality of life. By addressing the financial barriers that many women face, Saccos play a pivotal role in empowering women, strengthening communities, and driving inclusive economic growth in Kenya.
Transforming informal groups
Traditionally, Kenyan women have relied on informal savings groups, commonly known as chamas, to pool resources for emergencies or small investments
Some informal women’s groups (chamas) have been formalized into Saccos, enhancing greater financial access and scalability. This transformation empowers members to access credit facilities, invest in income-generating activities, and contribute to economic growth within their communities.
Bridging the Financial Literacy Gap
Lack of financial literacy has historically held women back from maximizing the benefits of financial services. Recognizing this, many Saccos in Kenya offer training on budgeting, savings, and investment. This is in line with one of the seven principles of co-operatives : education, training and information. This emphasis on education empowers women to make informed financial decisions, fostering a culture of savings and investment within their households and communities.
Social equity and collective strength
SACCOs do more than providing financial solutions; they create networks of support among women. By participating in SACCO meetings and activities, women build social capital, gain leadership skills, and amplify their voices in decision-making processes.
In counties like Machakos and Meru, women’s SACCOs have spearheaded community projects such as water harvesting systems and school construction. These initiatives demonstrate how financial independence can translate into broader societal impact.
Challenges and road ahead
Despite their successes, women-focused SACCOs face challenges such as limited resources to meet growing loan and service demands, cultural barriers that discourage women’s financial participation in some regions, and a digital divide that restricts rural women from accessing mobile banking solutions due to lack of smart phones or internet access.
Addressing these challenges requires increased government and donor funding to strengthen SACCO capacity, awareness campaigns to challenge cultural norms and promote women’s participation, and investments in digital literacy programmes and affordable technology to ensure inclusivity.
SACCOs have become a lifeline for Kenyan women, offering a pathway to financial independence and social equity. By addressing systemic barriers and fostering a supportive environment, SACCOs are not only transforming individual lives, but also contributing to Kenya’s broader socio- economic growth.