Declare interest to members, SACCOs and VSLAs told
GULU- Just like banks do, managers of SACCOs and Village Savings and Loan Associations [ VSLAs ] should make it a routine to declare the earned interest to members every year as one of the ways of promoting accountability and transparency within these savings groups.
According to Richard Jomeo Komakech, the Acholi Human Rights Activist, several Saccos and VSLAs in the region have gaps in areas of accountability, something she said tends to affect ownership among the members.
“Just like the banks do every year in declaring interest to the shareholders, it should be applied to the SACCOs and VSLAs as well. In doing that, trust will be built,’’ he said.
Komakech called for massive sensitisation among the SACCO and VSLA members across the region, arguing that the problem of accountability cuts across most of the SACCOs and VSLAs.
Joyce Akumu, the secretary, We Are for Justice SACCO, says they do not have knowledge on how best to run their SACCO, indicating that leaders sometimes cheat members due to financial illiteracy.
“Capacity building should be enforced so that members get to know their rights. Otherwise, some members prefer keeping money in their homes since Saccos have not been of any benefit to them,’’ she said.
She however faulted the district commercial office, claiming officials there only focus on bigger SACCOs, leaving small ones without any technical advice.
However, in response, the district commercial officer, Patrick Lakica Ojok said they are always available for technical support if their office is approached.
“Some SACCOs exist by default, they do not register with the district and it becomes very hard to trace them. It is only when they get issues such as loan defaulting that they come to us for help,’’ he said
Jonasana Opobo, who was a member of Together We Can savings group, said he pulled out of it and opted for bank loans after he was cheated.
He added: “I have opted to get loans from banks since I have been a victim at the hands of SACCOs and VSLAs.”
“No one bothers to educate us on the interest rates when one gets a loan. Several community members have lost assets such as land,” he added.
About 312 SAACOs in Uganda were victims of fraud and poor governance, a report by the Project of Financial Inclusion in Rural Areas [PROFIRA] said in 2021.
In the report, PROFIRA, which monitors the performance of SACCOs in the country, said 64 out of the 453 registered SACCOs analysed, collapsed while 312 were struggling at the time due to fraud and poor governance among other challenges.
There is concern that some Saccos are managed by committees that are voted into officers during general meetings, but most of the leaders often lack the knowledge in managing SACCOs and depend on untrustworthy employees who embezzle members’ deposits.
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