MASINDI, March 22, 2024 – Masindi District Farmers Association savings and Credit Cooperative Society Limited [ MADFA SACCO ] registered an increase in loan portfolio from Shs 3.5 billion in 2022 to Shs 4.8bln in 2023, representing 39 percent increase, according to its latest financial statements.
MADFA SACCO also registered an increase in net profit of Shs 148 million in 2023, from Shs 131mln earned in 2022, an increase of 11 percent.
The figures were released in a report during the SACCO’s 16th Annual General Meeting held on Thursday at Country Inn Hotel in Masindi town.
Presenting the report, Rev. Canon Francis Kajura, Chairperson Board of Directors MADFA SACCO, explained that active members increased to 4,731 in 2023 from 3,042 members in 2022 , an increase of 56 percent.
Savings also increased to Shs 3.1bln in 2023 from Shs 2.4bln in 2022, representing 28 percent increase. Total assets also increased to Shs 6.6bln in 2023 from Shs 5.5bln, which is an increase of 19 percent.
The SACCO also registered an increase in total equity of Shs 2bln in 2023 from Shs 1.8bln representing 8 percent increase and membership also increased from 18,900 members in 2022 to 20,906 members registering 11 percent increase.
“I am pleased to report that MADFA SACCO performed remarkably well in 2023 across all the key indicators. This overall performance was commendable given the challenging operating environment characterised by the effects of global economic uncertainty marked by rising inflation, high energy and food prices and volatile markets,” he explained.
He said management adopted the Bank of Uganda loan provisioning standards. “The board adopted the Bank of Uganda loan loss provisioning standards. These standards require the society to make 50 percent provisions for all loans in arrears above 90 days and 100 percent provisions for all loans categorized as loss is loans in arrears 181 days or more. This increased the loan loss provisioning expenses from Shs 66mln to Shs 368mln in 2023 and thus reducing the profitability.”
Kajura was also disappointed by the low number of active members saying that only 22 percent of the total membership are fully paid up members.
“Most of the members in groups are yet to open individual accounts, which affects our growth prospects. This also affected the realisation of the targeted revenues inform of annual subscription,” Kajura noted.
On his part, Jackson Mburamanya, Chairperson Supervisory Board explained that client retention increased from 73 percent in 2022 to 89 percent in 2023, adding that loan portfolio in agriculture reduced from 50 percent in 2022 to 47 percent in 2023 while loans to commerce/trade increased from 50 percent in 2022 to 53 percent in 2023.
According to him, the percentage of women members of the SACCO increased from 36.6 percent in 2022 to 38.2 percent in 2023 while that of the youth members increased from 13 percent in 2022 to 19 percent in 2023.
Bob Muzoora, the SACCOs chief executive officer said that the SACCO is in the process of of transiting to Micro Deposit finance Institution (MDI) where they’ll be supervised by the Bank of Uganda.
Speaking during the meeting, Edward Mugisha one of the members in Masindi district challenged the SACCO authorities to go digital such that members in different services can easily access the service.
On his part, Johnson Abitekaniza, Commissioner Business Development and Quality Assurance, Ministry of Trade, Industry and Cooperatives challenged the SACCO managers to adhere to the laws governing cooperatives in Uganda.
Cooperatives in Uganda are registered under Cooperative Societies [Amendment] Act, 2022, and licensed under The Tier 4 Microfinance Institutions and Money Lenders Act 2016.
“They [laws] were put in place to ensure transparency, accountability and also improve reporting. Don’t see them [laws] in a negative way because they are there for the good of our cooperatives. If you follow them, you will transform your operations,” he noted.
MADFA SACCO is a member-owned financial cooperative which was started by smallholder farmers in Masindi out of the need for financial services.
In 2005, MADFA SACCO started as a saving and and loan association with 30 members but has since grown with incredible strength over last 19 years.
The SACCO”s target clients include smallholder farmers, commercial farmers, small scale business persons, community based institutions, community based organisations, women and youth.
The SACCO which covers the entire Bunyoro sub region has been enlisted among the big SACCOs in Uganda to be supervised by the Bank of Uganda under the provision of Section 110 [c] of the Tier 4 Microfinance Institutions and Money lenders Act, 2016.
https://thecooperator.news/sacco-leaders-in-masindi-disagree-over-emyooga-savings-requirement/
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