Kenya’s cooperative lenders are being pulled into the climate‑finance race as weather shocks seep into loan books and members look for cheaper, cleaner ways to power their businesses.
By Steve Umidha, OPA News Agency
Kenyan savings and credit cooperatives (saccos) are ramping up green lending to tap surging demand for climate finance and limit their exposure to climate‑linked credit risks.
Their new suite of investments includes backing renewable‑energy projects and scaling up energy‑efficiency upgrades to steady returns in sectors increasingly exposed to volatile weather.
Stima DT Sacco chief executive Gamaliel Hassan attributed the accelerated shift to green lending to mounting regulatory pressure and a rapidly growing base of climate-conscious members.
He said these twin forces are compelling the institution — and peers — to pivot swiftly toward sustainable products that shore up balance sheets against climate volatility while meeting evolving member demand.
Already, customers are asking for cleaner, cheaper options, while supervisors are pushing institutions to align with emerging sustainability standards.
Kenya’s Sacco Societies Regulatory Authority (SASRA) has been urging cooperatives to adopt green finance models similar to those now common in the banking sector.
The regulator sees climate aligned lending as central to building resilience in rural incomes, modernising the cooperative movement, and positioning saccos to attract new capital. Kenya’s cooperative sector ranks 14th globally, with assets of about US$6.2 billion and more than 6.8 million members, according to the Kenya Union of Savings & Credit Cooperatives (KUSCCO).
SASRA’s approach centres on helping saccos manage the financial fallout of erratic rainfall, prolonged droughts, and flooding—shocks that have weakened borrower repayment capacity in key rural markets.
The regulator is also pushing for policy support to scale up green finance and strengthen the long term viability of the sector.
Stima DT Sacco is among the early movers. The institution is lining up KSh100 million in business loans for member led projects that deliver environmental benefits, from cutting emissions to improving energy efficiency or restoring degraded ecosystems.
The six month pilot, run in partnership with the World Council of Credit Unions (WOCCU), will finance electric vehicles, rooftop solar installations, and other climate friendly investments in the sustainable real estate and SME sectors.
Dr Hassan said the sacco has secured regulatory approval for its green savings product and is awaiting final clearance for the loan facility.
“We are very confident this is the year we get to do this. We are dealing with retailers across agriculture, energy and other sectors, and we are also targeting individuals in the diaspora with this product,” he said.
Other cooperatives are also moving in the same direction. Kenya National Police DT Sacco has embedded environmental sustainability into its 2025–2029 strategic plan, including a waste management programme and support for climate smart agriculture among its members.
Mwalimu Sacco, following the launch of its sustainability report in March 2025, has restructured its balance sheet to strengthen financial resilience while rolling out low cost digital services through its mobile platform, M HELA.
The institution says the changes are part of a broader push to support responsible, climate aware growth for its members.
Amica Savings and Credit Limited in Murang’a secured a KSh300 million loan facility from the Kenya Development Corporation (KDC) in late 2024 to support local businesses in agriculture, manufacturing, and trade.
The facility—funded by the World Bank through the SEFA programme—targets post COVID recovery and climate resilient MSME investments across multiple sectors.
“This loan facility will go a long way in meeting our strategic plan of creating an institutional culture of excellence even as we aim to realise and hopefully surpass our revenue target for the year,” said Amica CEO James Mbui at the time.
The sector’s aggressive push into green lending aligns with Kenya’s broader climate finance ambitions.
The government is strengthening legal frameworks, expanding county level climate funds, and promoting green investments to meet its US$62 billion Nationally Determined Contribution (NDC) target for 2020–2030.
Key initiatives include the Climate Change Act (2016), the County Climate Change Fund (CCCF), and the Financing Locally Led Climate Action (FLLoCA) programme.
One Planet Agency
