The Microfinance Support Centre (MSC) has launched a nationwide rollout of Regional Loan Clinics aimed at extending affordable credit to underserved communities and strengthening savings groups.
The initiative, which kicked off in the Busoga sub-region, specifically in Kaliro, Bugweri, and Namutumba districts, brought together more than 300 SACCO and cooperative executive leaders from over 46 SACCOs and cooperatives.
Participants were trained in SACCO management, compliance, and loan application processes under the theme: "Bringing Financial Inclusion to the Last Mile: Bridging the Credit Gap."
During the training sessions, financial experts from MSC, local governments, and the Ministry of Trade, Industry and Cooperatives guided participants on loan acquisition, management, and recovery strategies.
Follow us on WhatsApp | LinkedIn for the latest headlines
Speaking at the launch, MSC Eastern Uganda Regional Manager Francis Elwoku said the program is specifically targeting groups, SACCOs, and cooperatives that have not previously benefited from government interventions.
"We have started our Regional Loan Clinics, and basically the Microfinance Support Centre is targeting groups, SACCOs, and cooperatives that have not benefited from government programs," Elwoku said.
He emphasized that MSC is offering a range of loan products tailored for groups, Village Savings and Loan Associations (VSLAs), SACCOs, and cooperatives at what he described as the most affordable rates in the country.
"We give loans at 8% per annum, which is about 0.6% per month. No financial institution can offer such rates in Uganda," he noted.
Elwoku added that the intervention is intended to counter exploitative moneylenders who have penetrated rural communities.
"Most people have been exploited by moneylenders. That is why the Microfinance Support Centre has developed affordable loan products specifically for low-income earners," he said.
MSC, which implements the Emyooga programme, is now moving to supplement existing SACCOs with additional credit facilities beyond the initial seed capital.
"When we see that a SACCO is performing well, we can provide additional loan funds so that they do not resort to other financial institutions that charge higher interest rates," Elwoku explained.
He noted that although SACCOs initially received Shs30 million in seed capital, followed by expected annual top-ups of Shs20 million, many have grown beyond those limits and now require additional funding.
One of the major highlights of the program is access to unsecured loans for organized groups.
"For groups, we provide loans ranging from Shs5 million to Shs50 million without security. A SACCO or cooperative can access up to Shs100 million without collateral," Elwoku said.
He stressed that unlike traditional banks, MSC prioritizes group accountability rather than collateral security. He also urged SACCO members to organize themselves and take advantage of the affordable loans.
Officials from the Ministry of Trade, Industry and Cooperatives used the platform to warn SACCO leaders against poor governance and non-compliance, which they said has led to the collapse of many cooperatives and SACCOs.
Senior Cooperative Officer Miria Hamega emphasized the importance of Annual General Meetings (AGMs) and proper record-keeping for SACCOs and cooperative societies.
She urged leaders to establish well-structured administrative systems, including maintaining key registers such as a beneficial owners' register, and to familiarize themselves with the Cooperative Societies Act.
"SACCO and cooperative leaders must ensure they have organized administration supported by proper records and a clear understanding of the Cooperative Societies Act to enable them run their institutions effectively. They should also have physical office spaces that ensure accessibility, rather than operating from informal or mobile setups," she said.
Hamega further highlighted the significance of Section 14 of the Act, which outlines requirements for registration and certification of leaders. She advised that all relevant certificates should be properly displayed and kept at cooperative offices.
She also encouraged leaders to consistently hold AGMs, noting that they are essential for accountability, transparency, and effective management.
"Hold Annual General Meetings because even the loans we are discussing are approved during AGMs. If the AGM has not sat, then decisions regarding loans cannot be made," she said.
Hamega added that many SACCOs fail due to weak leadership and lack of accountability.
"Leaders are not doing what they are supposed to do. They fail to hold Annual General Meetings and do not involve members. In the end, the SACCOs collapse," she said.
She also warned against selfish leadership practices.
"If leaders think the money belongs to them and share it among themselves, accountability disappears and eventually the SACCO collapses," she added.
Namutumba Resident District Commissioner (RDC) Paul Waiswa called for more financial literacy training, noting that there is still a significant knowledge gap in loan acquisition.
He explained that many people in rural areas are eager to access loans to start or expand businesses but are discouraged by high interest rates charged by financial institutions and moneylenders.
Bugweri County MP Sadala Wandera commended MSC for organizing the loan clinic, saying it would benefit many people. He urged SACCO leaders to apply the lessons learned to improve financial management within their groups.
Kaliro District LC5 Chairperson Elijah Kagoda Dhikusoka acknowledged that previous government programs in the district struggled due to mismanagement.
He cited cases where SACCO leaders disappeared with funds, leaving groups inactive. However, he welcomed MSC's approach of training beneficiaries before disbursing funds.
He said the initiative would "offer security to the money yet to be given to SACCOs."
Beneficiaries welcome initiative
Participants described the training as transformative.
John Baptist Isoba, one of the trainees, said the clinic had opened his eyes to new financial opportunities.
He described it as "an eye-opener to wealth," adding that he had previously avoided government programs due to lack of information.
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
"I was also surprised to learn that we can get a loan as a SACCO without security. This time round, I will not be left behind," he added.
MSC says the Regional Loan Clinics will be extended to all regions across the country with the aim of equipping communities with financial literacy, improving loan management, and expanding access to affordable credit.
The initiative is expected to play a key role in bridging Uganda's credit gap, particularly among rural and low-income populations.
SACCOs, cooperatives, MFIs, and other groups/VSLAs applying for loans are required to submit key documents including a certified certificate of registration or incorporation, constitution/by-laws, annual returns, audited financial statements for at least one year, a valid operating license, and a formal resolution to borrow.
They must also provide bank statements, a business plan, collateral security covering the loan and interest, and evidence of at least one year in operation with a clear governance and ownership structure.
In addition, applicants should have proper staff capacity, including at least two members with basic accounting or microfinance knowledge, and a clearly defined and accessible operational location.
For groups and VSLAs under affordable finance, additional requirements include certification from the Community Development Office, group constitution, executive committee contacts with ID copies, recommendation letters from the LC1 chairperson and NGO/CDO, as well as basic records and a designated meeting place.
Other documents may be requested depending on the application. The loan limits range from a minimum of Shs5 million to a maximum of Shs3 billion.
