Fresh findings in SASRA’s Quarter Four 2025 Statistical and Soundness Report reveal a sub sector expanding its financial footprint, strengthening its reserves and improving loan performance, even as asset quality, liquidity management and sustainable growth remain central to its future
Kenya’s regulated Sacco sub sector closed 2025 with a significant financial milestone. Total assets rose to Kshs. 1.209 trillion by December, representing year-on-year growth of 11.91 per cent, according to the Sacco Societies Regulatory Authority (SASRA) in its Quarter Four 2025 Statistical and Soundness Report.
Released in September 2026, the report provides an important assessment of the sub sector’s financial performance and soundness through December 2025. Its findings reveal an industry expanding its balance sheet, increasing lending activity and strengthening its reserves, while also highlighting the importance of maintaining prudent lending standards and adequate financial safeguards.
The figures on the SASRA report demonstrates the growing financial significance of Saccos in mobilising savings, extending credit and financing activities ranging from property acquisition to agriculture and education. However, Sacco boards, management and investors, are wondering whether this expansion can be sustained while preserving asset quality, capital strength and institutional stability.
A Kshs. 1.2 trillion industry takes shape
Total assets increased from Kshs. 1.080 trillion in December 2024 to Kshs. 1.209 trillion in December 2025, an increase of approximately Kshs. 128.68 billion.Deposit-taking Saccos (DT-SACCOs) accounted for Kshs. 1.069 trillion of the total, while non-withdrawable deposit-taking Saccos (NWDT-SACCOs) held Kshs. 140.49 billion. The distinction matters because the two segments operate under different regulatory frameworks and are assessed using different financial soundness indicators.
DT-Saccos continued to anchor the sub- sector’s performance, with assets growing from Kshs. 949.77 billion to Kshs. 1.069 trillion over the year. NWDT-Sacco assets also increased, rising from Kshs. 131.10 billion to Kshs. 140.49 billion.
For the wider business community, the scale of these balance sheets matters beyond the cooperative movement. Saccos finance land acquisition, housing, education, agriculture and trade, making their performance relevant to household investment, enterprise activity and the circulation of domestic capital.
Lending and deposits continue to expand
Gross loans across regulated Saccos reached Kshs. 948.31 billion in December 2025, up from Kshs. 842.80 billion a year earlier. Over the same period, total deposits increased from Kshs. 750.63 billion to KSh 831.91 billion.The figures illustrate the scale of financial intermediation taking place through the cooperative model. Members’ deposits provide an important funding base, while loans enable them to finance personal needs, invest in property, support agricultural production and grow businesses.
However, credit expansion requires disciplined funding and risk management. Lending generates income opportunities, but it also exposes institutions to repayment risk. Sustainable growth therefore depends on sound borrower assessment, effective loan monitoring, appropriate provisioning and timely recovery of overdue facilities.
The difference between the growth rates of loans and deposits deserves attention. Gross loans expanded by 12.52 per cent year-on-year, compared with deposit growth of 10.83 per cent. Although this difference does not, by itself, establish a funding problem, it reinforces the need for Saccos to ensure that lending remains aligned with their funding structures, capital positions and liquidity requirements.
The increase in reserves provides another important dimension. Aggregate reserves grew faster than assets, loans and deposits, indicating that the sub – sector’s expanding financial activity was accompanied by growth in accumulated financial buffers. For boards and management teams, the priority is to ensure these gains translate into lasting resilience.
Reserves strengthen as income rises
Total reserves increased from Kshs. 218.90 billion in December 2024 to Kshs. 251.80 billion in December 2025, representing year-on-year growth of 15.03 per cent. The total sub sector income also rose, from Kshs. 154.31 billion to Kshs. 172.44 billion.DT-Saccos contributed Kshs. 156.04 billion of the 2025 total income, while NWDT-Saccos recorded Kshs. 16.41 billion.
These developments matter because reserves and institutional capital help financial institutions absorb potential losses and support future operations, while income enables them to meet expenses and continue delivering services to members.
However, sub-sector-wide figures should not be mistaken for evidence that every Sacco has an equally strong financial position. Differences in profitability, asset quality, operating costs and capital adequacy can exist beneath positive aggregate results.
SASRA also notes that its financial soundness indicators are based on periodic statutory reports and returns submitted to the authority. The figures may change following the audit of financial statements for the year ended December 2025 and subsequent supervisory adjustments or stress assessments. The reported results should therefore be interpreted within that context.
Loan quality shows a fourth-quarter improvement
Asset quality remains central to the sustainability of Sacco lending. SASRA’s report records a notable improvement in the DT-Sacco segment during the final quarter of 2025.The non-performing loans (NPLs) ratio for DT-SACCOs declined from 7.17 per cent in September 2025 to 5.41 per cent in December. The ratio had stood at 6.15 per cent in December 2024, meaning the year-end improvement also brought the indicator below its level a year earlier.
However, the December ratio remained above the report’s stated benchmark of less than 5 per cent. The improvement is therefore significant, but it does not remove the need for continued attention to repayment performance and loan recovery.
Net non-performing loans relative to core capital also improved considerably, declining from 7.30 per cent in September to 3.43 per cent in December 2025. NWDT-Saccos recorded a similar quarterly improvement, with their non-performing loan (NPL ) ratio falling from 8.41 per cent to 6.36 per cent, although it remained above the stated benchmark.
For the Sacco leadership, the priority is to establish whether these improvements can be sustained. Effective credit assessment, early identification of repayment challenges, consistent monitoring and appropriate recovery measures are essential to protecting the loan book.
A falling NPL ratio is encouraging, but its long-term significance depends on the quality of the underlying portfolio and the institution’s ability to prevent new arrears from replacing loans that have been recovered or otherwise resolved.
Liquidity and capital adequacy remain central
The report’s liquidity indicators provide further insight into the sub- sector’s financial position. DT-Saccos recorded a liquidity ratio of 74.50 per cent in December 2025, compared with the stated regulatory minimum of 15 per cent. The ratio had stood at 72.92 per cent in December 2024.
In the same vein, DT-Saccos core capital increased from Kshs. 167.48 billion to Kshs. 190.96 billion over the year. Core capital represented 17.86 per cent of total assets, above the report’s stated minimum of 10 per cent, while core capital relative to total deposits stood at 26.26 per cent against a minimum of 8 per cent.For NWDT-Saccos, the core capital reached Kshs. 17.96 billion, representing 12.79 per cent of total assets and 17.13 per cent of total deposits. The report specifies minimum thresholds of 8 per cent and 5 per cent, respectively.
These figures indicate that the sub- sector maintained aggregate capital and liquidity buffers. Such safeguards are important because Saccos must balance lending to members with the obligation to meet withdrawals and other financial commitments.
Nevertheless, strong aggregate ratios do not eliminate institution-specific risks. The composition and accessibility of liquid assets, the distribution of funding sources and the quality of individual loan portfolios remain important considerations.
The gross loans-to-deposits ratio also warrants attention. It reached 115.63 per cent for DT-Saccos in December 2025, up from 113.89 per cent a year earlier. For NWDT-Saccos, it increased from 101.65 per cent to 102.65 per cent.
These figures show that gross lending exceeded reported deposits in both segments. They do not automatically establish distress, but neither should they be treated as proof of superior financial efficiency. Their implications depend on wider funding arrangements, capital availability, asset quality and applicable prudential requirements.For executives, this reinforces the importance of liquidity stress-testing and ensuring that credit expansion remains consistent with each institution’s capacity to withstand unexpected financial pressures.
TheSacco credit trajectory
SASRA’s sectoral lending analysis highlights the cooperative movement’s role in financing economic activity. Regulated Saccos disbursed Kshs. 135.48 billion in new credit during the fourth quarter of 2025, compared with Kshs. 131.84 billion in the preceding quarter.
Land and housing attracted the largest share, receiving Kshs. 35.31 billion, equivalent to 26.06 per cent of total disbursements. Land acquisition accounted for Kshs. 19.55 billion, while housing received Kshs. 15.75 billion.
Agriculture followed with Kshs. 28.46 billion, representing 21.01 per cent of total credit. Crop farming accounted for Kshs. 13.44 billion and animal production Kshs. 12.81 billion. Education attracted Kshs. 26.83 billion, or 19.80 per cent, while trade received Kshs. 16.63 billion, equivalent to 12.27 per cent.Other allocations included Kshs. 11.41 billion for consumption and social services, Kshs. 6.62 billion for finance, investments and insurance, Kshs. 6.49 billion for manufacturing and servicing industries, and Kshs. 3.73 billion for human health.
For business leaders, these figures offer a useful snapshot of credit allocation at the end of 2025. However, disbursement volumes alone do not establish the eventual economic returns generated by those loans. Their impact will depend on how effectively funds are used, borrowers’ repayment capacity and the performance of the activities being financed.
The strategic priorities for Sacco leadership
SASRA’s findings provide a basis for several strategic considerations as the sub-sector moves through 2026.First, Saccos must balance expansion with credit discipline. Growing loan books create opportunities to serve members and support investment, but the NPL figures demonstrate why effective underwriting, early-warning systems and recovery processes remain essential.
Second, funding and liquidity management must remain prominent on board agendas. With loans growing faster than deposits, institutions need to understand their funding requirements under normal and stressed conditions, rather than relying solely on sub sector-wide averages.
Third, capital preservation must accompany growth. The increase in reserves is an important feature of the sub- sector’s 2025 performance, but capital planning must reflect each institution’s growth ambitions, asset quality and exposure to potential losses.
Finally, boards and management teams should use the report as a starting point for institution-level analysis. Comparing performance over time, reviewing relevant soundness indicators and examining audited financial statements can help leaders identify emerging risks and make better-informed strategic decisions.
Growth is the beginning of the conversation
SASRA’s Quarter Four 2025 report presents a regulated Sacco sub –sector that has crossed Kshs. 1.2 trillion in assets, expanded lending and deposits, strengthened aggregate reserves and recorded a substantial fourth-quarter improvement in reported loan quality.
The figures not only demonstrate the sub- sector’s financial significance, but they also underline why the quality of growth matters as much as its scale. For the Sacco boards and executives, the task is to translate financial expansion into sustainable performance through prudent lending, capital preservation, careful liquidity management and responsible service to members.
The Kshs. 1.2 trillion milestone therefore represents the financial capacity the sub-sector has built and a reminder that its long-term contribution will depend on how effectively that capacity is managed.
