Serere’s Mugarama B VSLA, building bridges to financial inclusion and prosperity
Started in 2023 with 40 members, Mugarama B VSLA now boasts of 115 members within a space of one year.
SERERE, July 25, 2024 – In the country where most people in rural areas are outside of the financial system, Mugarama B Village Savings and Loans Association [Mugarama B VSLA] nestled along the shores of Lake Kyoga in Labor Sub-county, Serere district stands tall as a beacon of hope for financial inclusion of its members.
Started in 2023 with 40 members, Mugarama B VSLA now boasts of membership of 115 members within a space of one year. The members from varied backgrounds meet every Sunday to save between Shs 1,000 and Shs 30,000 depending on somebody’s capability.
The Chairperson of the VSLA, Rose Apiango tells this reporter that the money saved is loaned out with an interest rate of 5 percent for registered members and 10 percent for nonmembers monthly.
“This means that if one borrows a loan of Shs 100,000 one has to pay back the principal amount with an interest of Shs 5,000 on top which is below the 15 percent interest rate being charged by money lending institutions,” says Apiango.
She says that on July, 2023 Mugarama B VSLA was lucky to get seed capital of Shs 500,000 from Opolot Fred Foundation, an initiative started by the Pingire County legislator, Fred Opolot to offer health, education and financial services in his constituency.
For many, Shs 500,000 appears trivial trigger economic empower of the rural communities living in extreme poverty. But to for the members of Mugarama B VSLA, it turned to be a beacon of hope, a pathway out of extreme poverty.
Apiango says the seed capital of Shs 500,000 they received from Opolot Fred Foundation has exponentially grown to Shs 30 million in a space of one year.
“Of Shs 30mln, the association currently has Shs 23mln are savings while Shs 7.2mln is interest accumulated in one year,” she says.
According to her, the association has empowered its members who are small scale farmers, fishermen and traders through affordable loans it provides, enabling many to achieve their dreams.
She says that with clear work ethics, integrity and good governance paramount at the association, members and customers are promptly attended to and assisted as per their demands and needs.
“When we started, a year ago, some people didn’t take us seriously thinking that we were going to fail but the association has gone from strength to strength,” says Apiango.
She added that the association has become a well-recognised brand in the community where people get quick loans with the lowest interest rate.
“Mugarama B VSLA upholds its values by treating its members like family, providing care and support in times of need. The association helps its members grow within their means, offering quick and affordable loans,” says Michael Opega, the association’s treasurer.
Opega is excited about owning two cows which he bought using the loan he acquired from the association.
“I borrowed Shs 2 million which I used for buying two cows currently in gestation stage and about to produce,” says Opega.
According to him, the association has not only helped him have cows, it has also helped him buy fishing gear.
“This VSLA stands as a beacon of hope for those aspiring towards a secure financial future. It is are a catalyst for change here in Mugarama which is predominately occupied by the fishing community living around Lake Kyoga. The association is a lifeline for our members,” explains Opega.
Sarah Akello, another member dealing in fish business notes that Mugarama B VSLA is a big blessing to the community as it has saved people from the money lenders charging high interest rate and confiscating people’s national identity cards as collateral.
“Getting a loan from a commercial bank is hard since they need collateral but Mugarama B VSLA gives people loans without asking collateral,” says Akello.
She adds that borrowers are always free to negotiate with the association leadership for the extension of repayment period in case one fails to get the money on the agreed time frame.
For Jessica Alungat, saving with Mugarama B VSLA has enabled her enroll her son to go for higher education, after sitting home for three years upon completion of high school due to lack of tuition fees.
“My son stayed at home for three years after he completed high school due to lack of money but when I joined Mugarama B VSLA and started saving, I got a loan of Shs1 million to start up a fish business, which now generates enough money, and I use some of it to pay my son’s tuition,” she says.
Meanwhile, MP Fred Opolot has commends the association leaders for having a well-coordinated governance structure that ensures seamless decision-making, representation of members’ interests at every stage, and smooth succession.
He says the tremendous growth Mugarama B VSLA in a short period is one of that many out there to learn from.
“However, Mugarama B VSLA’s success has not come on a silver platter, but through well stipulated ethos and principles anchored in a prudent leadership and management,” says Opolot.
The legislator says he intends to support Mugarama B VSLA and other well performing associations in Pingire County into a reputable financial institutions whose achievements in building members’ livelihoods through financial inclusion stands tall in the communities.
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