SACCOs urged to invest savings
Savings and Credit Cooperative Organisations (SACCOs) have been urged to invest their savings in order to grow their profits.
Gulu City Mayor-Elect, Alfred Okwonga, who was over the weekend speaking to members of Kacel Watwero saving group- which is mainly composed of journalists in Gulu, said that depending on the small interest accrued from loans given to members is not sustainable.
“Saving is good for investment, don’t just save. At the end of the year, you have people who have saved Shs100m and that money is given to members in loans instead of multiplying it through investments,” he said.
Okwonga advised that the kind of investments SACCOs engage in should take into account the fact that members don’t have time to monitor the investment daily.
“You can consider investing in short term projects like animal trade. For instance, the butchers in Gulu don’t have enough capital to buy animals in bulk. If you take up the animal trade, you will earn good profits,” Okwonga said.
He also advised them to consider investing in farming by choosing high-value crops that do not take long to mature, citing horticultural crops like Irish potatoes and onions.
“With proper guidance from extension workers, you can make profits in horticulture farming,” Okwonga assured the journalists’ group.
Tricky venture
However, Okun Felix Ochola, the Chairperson of Kacel Watwero SACCO said group investment is a tricky venture since members have different plans and aspirations.
“What we advise members to do is personal investment in things like poultry, among others, to grow financially instead of leaving their savings to be used by banks,” he said.
He also revealed that the group had been a beneficiary of the Presidential Initiative on Wealth and Job Creation, Emyooga.
“We have received 30 million shillings from Emyooga-government funds which we expect members to borrow and invest in their personal projects,” he said.
He however noted that just 50 % of members borrow money for investment, 30 % for pressing needs like school fees and medical bills, while 20% borrow for leisure activities.
Meanwhile, the group that was created out of Northern Uganda Media Club-NUMEC in 2012 and has 50 members, did not earn interest in 2020 due to low savings and poor repayment of loans.
George Orach, the group’s Treasurer, said the savings dropped from Shs 21m in 2019 to Shs 12.8m in 2020.
“We have not been able to collect 4 million shillings given to members as loans,” he reported.
The group members started another cycle of saving in late January without distributing their 2020 savings.
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