Government is considering channelling all the NAADS money through SACCOs
Government has boosted a SACCO in Sheema district with sh550m in a bid to fight poverty at household level.
The money which the government extended to Shuuku Peoples Savings and Credit Cooperative Society Ltd and Bugongi SACCO through the Micro Finance Support Centre, will benefit over 9,000 members of both SACCOs. The SACCOs will pay the money back in three years.
State minister for finance in charge of Microfinance Haruna Kyeyune Kasolo, handed over the cheque to SACCOs officials in Kishabya trading centre and Bugongi respectively in Sheema district.
Kasolo said lack of a savings culture is making many Ugandans poor and hindering the country’s economic development.
“We tell our people to save, this is the only way they will get out of poverty” Minister Kasolo urged.
The minister warned officials of the two SACCOs against lending the money to members beyond the mandatory government interest rate of 2% for agricultural loans.
He said that SACCOs have a habit of getting money from government at a cheaper interest rate of 9% and lend it at 36% to members which will attract severe punishment this time.
I want to warn SACCOs that this time it’s ‘Kishanja Hakuna Muchezo’, any SACCO that will lend our money beyond 2% will be punished immediately,” the minister said.
He explained that government has finalized plans to train members of all the 500 SACCOs in the country to enable members acquire skills in financial matters.
The minister revealed that government is considering channelling all the NAADS money through SACCOs as a means to boost their operations and income.
He said his ministry is also trying to convince cabinet to have all other monies going to different groups like youth and women to have them channelled through SACCOs in various districts.
John Peter Mujuni, the Micro Finance Support Centre executive director, cautioned the management and the institution’s board not to divert the money into others things.
He explained that as Microfinance Support Centre, they want the money to benefit the masses but not a few individuals.
Steven Bongonzya, the chairperson board of directors Shuuku Peoples Savings Cooperative Society Ltd called on government to reduce on the 30% corporation tax which is hurting the development of SACCOs.
The Sheema LC5 chairman David Kabigumira said that the district leadership has embarked on a massive campaign to have all residents above 18 join SACCOs.