Churches face challenges in paying their clergy and financing church projects. The transition from missionary support to self-reliance, self-propagating and self governance has seen many local churches face financial constraints. One of the ways of financial sustainability is through Savings and Credit Cooperative Societies (SACCOs.The main purpose of the study was to determine the effect of KAG-SACCO in raising the income of the clergy, members and churches in Gusii District of Kenya Assemblies of God Church. The study objectives were to: determine the sources of church funding in KAG-Gusii District, determine the level of saving in the KAG–SACCO, determine the amount of funds borrowed from KAG–SACCO by Gusii District, determine whether income has improved after investment used by money borrowed from KAG-SACCO and determine the default rate among those who have borrowed from KAG-SACCO. The population of the study was 74 members and six departments. Descriptive research design was used. The study use census sampling procedure. An open ended questionnaire was used for data collection. Descriptive statistics was used for data analysis. The study findings were; 99% churches in Gusii District depended on their tithe and offering for church funding while only 1% of the churches relied on KAG-SACCO for funding, the level of saving in KAG- SACCO in Gusii was low as evidenced by only 14 % of respondents with over 50,000kshs of share, only 17% of respondent had borrowed over khs 50,000 kshs as loan to make significant economic impact, only 10 % of respondent reported income increase while 26 % of respondents got more poorer and 62 % reported no improvement in income and about 59% of borrowers had defaulted on loan repayment. The study concluded that the KAG SACCO had not led to economic transformation of SACCO members. The members needed to save more shares to borrow more loans and there was need to educate members of KAG SACCO on investment opportunities with returns.
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