East African Business Week (Kampala)
Phillip Nabyama
28 January 2008
Kampala — The European Union (EU) wants a Savings and Credit Cooperative Organisations (SACCOs) Act and an independent regulatory body to guarantee their independence.
Mr. Vincent De Visscher, the Head of Delegation of the European Commission to Uganda made the call at last Friday's presentation of the assets valued at Ush300 million (US$ 176,470) to the ministry responsible for the SACCOs to the finance state minister for microfinance, Mr. Caleb Akandwanaho in Kampala.
"SACCOs are the only financial institution in Uganda that are not properly regulated," the ambassador said, prompting the minister to reveal that his ministry had up to end of March fast track the SACCO Act in Parliament.
Previously owned by the now defunct Support to Feasible Financial Institutions' Capacity building Efforts (SUFFICE I and II, - a two and half year project that wound up in December of 2007) funded by the EU, the equipment included office and training equipment and furniture, 21 printer equipped computers and five all terrain vehicles.
A statement from the EU said that the ministry would in turn hand over the assets to the Uganda Cooperative Savings and Credit Cooperative Union (UCUSCU), which has been designated by government to take a lead in the development of SACCOs.
It added that the EU has been supporting the micro finance sector in Uganda, starting with the micro projects programme that was restructured in 1999 leading to the formulation of the SUFFICE I and II with a budget allocation of Ush 15.5 billion ($9,117,647).
In Uganda today, there are currently about 500 SACCOs in the country and 300 of those are active. Under this new scheme, government plans to have 1,000 active SACCOs in at least every sub county particularly those that do not have.
SACCOs are part of the "Prosperity for All" vision or Bonna Bagaggawale" announced by President Yoweri Museveni during the 2006 presidential elections meant to help members of a particular SACCO save money and also access loans conveniently and safely.
Post Bank Uganda has been tasked with coordinating and channelling the scheme's money across the entire country.
Apart from improving household incomes, the money will also intervene in value addition for the export sector and also help market farmers' produce and bring about rural financial services.
The bank will through this scheme be able to offer banking services and Information Technology (IT) support to people in the rural areas.
Through the linkage-banking programme, Post Bank has in place a system where it lends money to the SACCOs and Micro Finance Institutions (MFIs), which use this money to on-lend to their clients.
SACCOs are recognised by the Uganda Cooperative Societies Statute 1991, and the Cooperative Societies Regulations of 1992.
Be the first to Write a Comment!
Copyright © 2008 East African Business Week. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
