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Govt moves to regulate self-saving groups
Members of NUSAF 3 savings group in Otuke District come together to save money in July 2019. PHOTO / BILL OKETCH
What you need to know:
- Self-saving groups are unregistered saccos where people save their money month, weekly or on a daily basis and lend among themselves.
Government is in the final stages of developing guidelines that will see all self-saving groups regulated by the Uganda Micro-finance Regulatory Authority (UMRA) .
The UMRA executive director, Mr Edith Tusubira, said the guidelines are intend to protect people’s savings from unscrupulous leaders who have been running away with money.
“These self-help groups have increased in the country over time, most especially among women in the informal sector. People have been cheating each other because the savings are not kept in the right way,” Ms Tusubira said yesterday, adding: “Let these groups go to their districts and register their members for easy management and regulations.’’
Ms Tusubira made the remarks while signing a Memorandum of Understanding between the UMRA, FIDA-Uganda and National Association of Women’s Organisations in Uganda (NAWOU).
Unlike Savings Credit and Cooperative Societies (Saccos) that are registered and licensed by UMRA, the groups will be given certificates by their respective districts. It will be the honour of districts to report to UMRA how many self-saving groups have been registered.
Self-saving groups are unregistered saccos where people save their money month, weekly or on a daily basis and lend among themselves.
UMRA legal officer Shillah Birungi said it is very hard for such groups to sue the people who run away with their savings.
According to her, some of the planned guidelines call for details on how much is saved, gender of the group members, and the management committee.
The guidelines are slated to be released before the end of this month, according to officials at UMRA.
About the MoU
The MoU leverages the roles each organisation is slated to conduct to enable Ugandans to use micro-finance services without being cheated.
The executive director of FIDA-Uganda, Ms Lilian Byarugaba, said: “We shall be able to offer legal literacy for people to understand the terms and conditions before borrowing money. We shall change agreements in their local language for them to be able to borrow and pay back safely.”
NAWOU executive director Monica Emiru said they will mobilise women without collateral security to access loans from micro-finance institutions and the government.
Ms Angella Nakafero, the commissioner of the Gender ministry, said the government released Shs32b this financial year under Uganda Women Entrepreneurship Programme for borrowing in addition to the 30 percent funds set aside for the parish model.
