BoU to regulate Saccos with Shs1.5b in savings
At least more than 40 Saccos are estimated to hold savings of above Shs1.5b each. Photo / File
What you need to know:
- The law provides Bank of Uganda with powers to provide supervisory oversight over Registered Societies (Saccos) with voluntary savings in excess Shs1.5b and institutional capital of above Shs500m.
Bank of Uganda has said it will, with amendments to the Microfinance Deposit-Taking Institutions Bill, 2022, start regulating at least 42 Savings and Credit Cooperative Societies (Saccos) whose savings are above Shs1.5b.
The regulation will be effected under the Micro Finance Deposit-taking Institutions (Registered Societies) Regulations, 2022.
Speaking during the second Central Bank Financial Stability Symposium, Dr Tumubweinee Twinemanzi, the Bank of Uganda executive director supervision, said Cabinet had already considered and approved the Microfinance Deposit-Taking Institutions (Amendment) Bill, 2022; and authorised the Minister of Finance to submit the Bill to Parliament.
“On [November 22], the minister presented the Bill for First Reading in Parliament. Key amendments proposed in the Bill include: Permitting [Micro Deposit-taking Institutions] to extend their services through agents, provide insurance services and products through Bancassurance and [offering] Islamic finance (Islamic microfinance), among others,” he said, noting that Tier 4 Microfinance and Money Lenders Act, 2016, the Central Bank is also mandated to provide supervisory oversight over Registered Societies with voluntary savings in excess Shs1.5b and institutional capital of above Shs500m.
Therefore, he said in order to operationalise the above mandate, Bank of Uganda together with Ministry Finance and First Parliamentary Counsel had finalised drafting of the Micro Finance Deposit-taking Institutions (Registered Societies) Regulations, 2022.
“The regulations have been approved and gazetted. Bank of Uganda with the Registrar of Cooperatives shall conduct country wide sensitisation campaigns on the Microfinance Deposit-Taking Institutions (Registered Societies) Regulations, 2022 ahead of anticipated licensing activities,” he said.
Dr Twinemanzi also said Bank of Uganda had completed guidelines that will guide implementation of Credit Reference Bureau (CRB) Regulations, 2022.
“The final copies are out and shared with stakeholders. Key amendments include opening of credit information sharing space to include accredited credit providers, other than dealing with just those entities regulated by Bank of Uganda,” he said.
