By: Kasimu Nsimbe
KAMULI: Speaker of Parliament Ms Rebecca Kadaga, has asked government to consider special incentives to commercial banks to open up branches in the rural areas.
Addressing a training workshop for Village Savings and Loan Associations organised by the Ministry of Finance at Nawanyago Sub-county headquarters in Kamuli District on Thursday, the Speaker noted that the absence of commercial banks in rural areas affects rural savings schemes. “Banks have concentrated on Kampala, Wakiso and Mukono districts. Government should provide incentives to these banks to open up in the rural areas,” she said.
Speaker Kadaga, who expressed concern over the slow progress of Saccoss in Busoga region urged members to uphold the spirit of trust and accountability. “Three years ago, I extended over Shs60 million to village Saccos. I have up to date not been invited to any meeting where progress reports are presented. Some have even closed shop. Saccos have succeeded elsewhere why not in Busoga,” the Speaker said.
Ministry of Finance officials report that over 13 Saccos in Kamuli have defaulted on payments of more than Shs200 million extended to them.
With reports from several Sacco and Village Savings Organisations also indicating low rates of payment returns from members, Speaker Kadaga re-echoed the need for trust as a basis for the success of such organisations.
“Our forefathers who were illiterate managed to uphold the spirit of cooperation through Busoga Growers Cooperative. Busoga saved enough resources to even extend loans worth over 30,000 Pounds to the government of the United Kingdom and Australia. When we know each other in the SACCO I think we can work better,” she told participants.Several participants blamed the failure of SACCOs in Busoga region on poor management by leaders, poor enterprise selection and lack of tough laws to punish loan defaulters.
SACCOS IN BUSOGA
Last year, the Sunday Monitor reported more than Shs1 billion in government grants and savings had been lost in Busoga region in the last five years following the winding up of over 150 Saccos. According to, Mr Ivan Kigere, the field officer of Busoga Saccos Union, most Saccos were compelled to fold due to financial mismanagement and failure by the government to provide capital. According to Mr Kigere, only 351 Saccos out of 522 that had by the end of 2008 been registered with the union remain operational.