FRONASA launches SACCO, calls for return of Cooperative Bank
MUKONO – The veterans’ wing of the Front for National Salvation [FRONASA] has launched a multi-purpose Sacco, calling on the government to re-open Cooperative Bank so that cooperators in Uganda can access cheap loans to do business.
The veterans who helped fight Idi Amin in the early 1970s have several groups totaling about 62 involved in different economic activities, came together in an effort to maximise their numerical strengths to uplift themselves out of poverty.
The outfit with different branches in western and eastern Uganda, launched its latest branch, Buganda Kyaggwe Fronasa Veterans Multi-purpose Society, with member groups drawn from Mukono, Kayunga, Buikwe, Wakiso, and Kampala Districts.
The society, with a total registration of at least 102 groups, boosts at least 312 individual members, all belonging to the different groups involved in different economic activities including farming, tailoring, poultry, crafts, market vending, transport, and other trading activities.
While launching the society at Goma Sub-county headquarters in Mukono district, the National Coordinator FRONASA veterans Saccos Maj. Vianney Matovu appealed to President Museveni to help bring back the Cooperative Bank so that cooperators can have a financial institution that can support their business by offering affordable loans.
Maj. Matovu said the current commercial banks in the Ugandan market, most of them foreign-owned, do not understand the aspirations and operations of cooperatives, which he said is the reason why they charge them high interest rates.
“The commercial banks here are all meant to repatriate money from the country, they are not local, and do not appreciate our desires. We have a young clientele that needs to be helped to grow,” Matovu said.
He added that the Cooperative Bank used to charge a small insignificant interest on its loans taken by the farmers and that it was designed to work with agricultural cooperatives and other groups whose business modes are not appreciated by commercial banks.
The Cooperative Bank was closed on May 1999 by the late Charles Kikonyogo, the governor of the Bank of Uganda at that time. The reasons given for its closure were “inadequate capitalization” and “insolvency to the tune Sh 4.8 billion, as at 31 December 1998”.
It was also reported later that the bank’s collapse was as a result of the withdrawal of support by the United States Agency for International Development [USAID], and a case of fraud involving bank officials.
Since 2008, there have been efforts to re-open the bank or create a replacement. In June 2019, Amelia Kyambadde, Uganda’s former Minister of Trade, Industry, and Cooperatives set a target of 2021 for the establishment of the bank, but this has not happened.
Since they don’t have their own bank, Uganda’s co-operative societies, traders and farmers experience difficulty in accessing loans from commercial banks, on account of high interest rates and unfavorable repayment terms.
Matovu calls on the Ministry of Finance to give priority to organised groups and cooperatives while building financial schemes to help uplift people from poverty.
He also called on Parliament and other statutory-making bodies to always carry out wide consultations while making laws and regulations for cooperatives to enable all stakeholders have an input.
He says the cooperatives and other private entities need representation in making several regulations that affect their operations.
“The cooperators need to have representation and fair say in making such regulations, as well as the private entities because they are always targeted,” he added.
Among the groups that make up Buganda Kyaggwe Fronasa Veterans Multi-Purpose Society include; Kundula Savings and Development Group, Kampala Central Fronasa Veterans Sacco, Civic Veterans Group, National Veterans Association, Chakaza Fronasa Veterans Sacco among others.
Fronasa was a Ugandan rebel group led by Yoweri Museveni. The group emerged in 1971, although it was formally founded in 1973. FRONASA, along with other militant groups such as Kikosi Maalum led by Milton Obote, formed the Uganda National Liberation Front [UNLF] and its military wing the Uganda National Liberation Army [UNLA] in 1979 to fight alongside Tanzanian forces against Idi Amin.
https://thecooperator.news/lutheran-church-launches-sacco-for-men/
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