SACCO dividends vs interest on deposits: which one earns you more?
Every year SACCOs announce two rates: a dividend on share capital and interest on deposits. Understanding the difference tells you which rate actually matters for your money.
When a SACCO announces its results, you usually see two numbers, for example "16% dividend and 11% interest on deposits". They apply to two different pots of your money.
Share capital: your ownership
Share capital is the money that makes you a part-owner of the SACCO. It earns a dividend, approved by members at the annual general meeting. You usually cannot withdraw share capital; you can only transfer or sell it to another member when you leave.
Deposits: your savings
Deposits are the savings you add every month. They earn interest on deposits, and in most SACCOs they also decide how much you can borrow, often a multiple of your deposits. When you leave, deposits are refunded, usually after a notice period.
Why the deposit rate usually matters more
Most members hold far more in deposits than in shares. Take a member with KES 20,000 in shares and KES 300,000 in deposits at a SACCO paying 16% and 11%:
- Dividend: 16% × 20,000 = KES 3,200
- Interest on deposits: 11% × 300,000 = KES 33,000 (if the full amount was held all year; many SACCOs work out interest on deposits month by month)
The headline dividend is higher, but the deposit interest is ten times bigger in shillings.
What leading SACCOs paid for 2025
- Tower SACCO: 20% dividend, 13% on deposits
- Ports SACCO: 20% and 12.5%
- Yetu DT SACCO: 19% and 13%
- Kenya National Police DT SACCO: 17% and 11%
- Stima SACCO: 16% and 11%
- Harambee SACCO: 15% and 9.1%
- Mwalimu National SACCO: 13% and 10.05%
See all 44 SACCOs on our SACCO dividends page.
Tax
Dividends paid by a SACCO to resident members are subject to 5% withholding tax. Ask your SACCO how tax is applied to interest on deposits and whether any charges come off before payment.
Before you join
- Check that the SACCO is licensed by the SACCO Societies Regulatory Authority (SASRA).
- Read the common bond: some SACCOs only accept people in certain jobs or employers.
- Look at several years of rates, not just one good year.
- Compare with a money market fund, which you can withdraw from in days.
Sources
This article is general information, not financial advice.