State warns counties for delaying sacco remittances

Money Markets

Kuscco national chairman George Magutu. FILE PHOTO | SALATON NJAU |  NATION MEDIA GROUP

By GITONGA MARETE

In Summary

• Kuscco national chairman George Magutu said some counties were frustrating saccos’ operations in the country, noting that there was no reason for employers to hold money they had already deducted from workers’ salaries.

Accounts of counties and firms defaulting on remittance of sacco contributions will be frozen.

Deputy commissioner of Co-operatives Development and Marketing Geoffrey Karuku said: “We are shocked to hear counties have defaulted on remittance of money deducted from workers’ salaries. This is illegal and we call upon saccos to take up the matter with us. The law allows us to send demand notices to those concerned and even order banks to freeze their accounts if they don’t cooperate.”

Mr Karuku, who spoke on Saturday in Mombasa during the Kenya Union of Savings & Credit Co-operatives (Kuscco) regional council meeting, was reacting to reports that Mombasa County was holding Sh69 million in members contributions to Jitegemee Sacco.

“Since it (money) has not been remitted it appears as though members have defaulted on their repayment so they are not eligible for more loans,” said Jitegemee executive officer Simeon Mwakoi during their annual general meeting at Tononoka Hall.

Kuscco national chairman George Magutu said some counties were frustrating saccos’ operations in the country, noting that there was no reason for employers to hold money they had already deducted from workers’ salaries.

However, county secretary Hamisi Mwaguya said the money was part of arrears that had accrued when the defunct municipal council was in office.