Police officers engage officials of the Police Exodus Sacco during a pass-out ceremony for security personnel at Police Training School Kabalye, Masindi District, in November 2023. PHOTO/ANDREW BAGALA
The Police Exodus Sacco is stuck with thousands of loan applications from its members after it ran short of funds to lend.
This follows the government’s failure to remit some of the savings deducted from the officers’ salaries as well as payment of arrears.
Multiple sources in the Police Sacco and in the police administration told Monitor that the Force owes its savings association about Shs6.5b in arrears and officers’ remittances.
“The Sacco is in real trouble because members are angry that they have savings but they can’t get loans three months after they applied for them. Some are now demanding that they are allowed to withdraw their savings to solve their financial issues,” a source said.
As a result, some officers are now demanding that they be allowed to withdraw their savings to solve their financial issues.
The chairperson of the Police Exodus Sacco, Mr Wilson Omoding, confirmed that they haven’t been able to dispense loans to their members due to technical challenges but called for patience.
“The issue of the police’s failure to remit to us funds deducted from officers’ salaries is just a technical issue in the government that is being resolved,” Mr Omoding said.
“The Ministry of Public Services is migrating from an old payment system to a new one. Once it is sorted, they will send the money to us. Our members should be patient,” he added.
Police Exodus Sacco chairperson Wilson Omoding addresses new recruits on benefits of joining the Sacco at Police Training School, Kabalye in Masindi District in 2023. PHOTO/COURTESY OF POLICE
Last month’s savings remittances from police salaries by the government to the Sacco were less by Shs1.6b.
Savings are the main source of income from the Police Sacco. It is those savings that they use to give loans to its members.
The second source of income for the Sacco is its catering business, which supplies food to police headquarters staff.
According to a police source, the police management has accumulated arrears above Shs5b.
Mr Omoding confirmed that the police are yet to pay the arrears, but they are scheduled to meet Inspector General of Police Abas Byakagaba and his team to have a conversation about how they will clear the payments.
A source said if the police management clears the outstanding arrears and remittances, the Sacco would be able to pay all the loan requests from its members.
“When the government gave police officers a salary increment at the beginning of this financial year, many members used it to clear their loans or seek a top-up credit on the existing loans. This has caused an increase in the demand for loans,” the source said.
The Sacco was given an average of Shs3b per month before the salary increment. They are getting loan requests worth Shs7b per month, a source said.
Several police officers, who applied for loans from the Police Exodus Sacco, told Monitor that they haven’t been able to get credit since August yet they have enough savings in their accounts.
“The police have been discouraging officers from acquiring loans from private financial institutions on grounds that they charge high interest rates and they demand collateral. We have been left with no alternative but to run to private financial institutions,” a police source said.
Another source said due to the predicament that the Police Exodus Sacco is in, the Force have been forced to give letters of undertaking to their officers who want to get loans from private financial institutions.
Police had earlier stopped giving letters of undertaking to their officers to get credit from private institutions in an attempt to prevent them from being victims of loan sharks.
