GULU — Stanbic Bank Uganda Limited has announced upto UGX.50 billion aimed at revitalizing the operations of Savings and Credit Cooperative Organisations (SACCOs) and Village Savings and Loans Associations (VSLAs) across Northern Uganda.
Unveiling the fund during a function held at Kaunda Grounds, Bardege—Layibi Division, Gulu, a city in Northern Uganda, Stanbic Chief Executive, Ann Juuko revealed that the fund would support about 1,000 different Saccos operating in Northern Uganda with an annual interest rate of 10 percent.
Ms. Juuko explained that the support is a private sector partnership with the government for investing in agricultural production with emphasis on agro-processing and value chain.
She further explained that the Bank had trained several group leaders in management of the Saccos, financial discipline and the skills for agro-processing.
“We are very excited to be going back to our roots of being the people’s bank (Uganda Commercial Bank). What we seek to do in this new SACCOs offering is to share our years of expertise and build capacity of the SACCOs to operate at the same level of excellence and in a modern manner. In addition to giving them loans at a small interest, we will also train them to use our online platforms like Flexipay so that they can handle their finances better,” Ms Juuko said, adding that:
“The Saccos will now operate as agent banks of Stanbic. They shall have insurance covers for their crops and livestock protecting them from unforeseen occurrences like seasonal changes”.
The arrangement will feature free cash and cheque deposits, free transfers into the account from members and free cash withdrawals for Saccos.
Mr. Patrick Twinamatsiko, the Manager Sacco at Stanbic, noted that the best approach for poverty eradication is to partner with groups and Cooperative Societies and urged members to remain integral at work.
He said the fund would help increase the number of bankable Ugandans since “we’re bringing the service close to them”.
“We now want to find them where they are and help improve financial inclusion in the country to drive economic activity. All the Saccos need is proof of demonstrable credit and financial behaviour from any commercial bank with which they bank,” Twinamastiko told Saccos leaders.
“Before rolling out the programme, we noticed that most Saccos had a poor saving culture, were very far, feared the high costs of maintaining a bank account and the banks are very far from their rural communities in which they are situated, and rudimentary means of servicing banks, etc.”
He said Stanbic Bank will also provide core banking capabilities including savings account management, credit and cash management, back-office accounting and financial reporting, deposit/withdrawals from the SACCO account among other digital trainings.
On his part, the National Coordinator of Operation Wealth Creation, Gen. Salim Saleh who was the Chief Guest at the function commended Stanbic Bank Uganda for the financial support to the agriculture sector.
He said that agricultural production contributes to 37 percent of the Gross Domestic Product (GDP) of the country’s economy and urged the private sector to invest in agro industrialization.
“I want to thank Stanbic Bank for putting money to agricultural production which many of the partners consider as risky to venture in but I want to say this is one big investment for the Country,” Saleh explained.
Gen Saleh said Stanbic Bank programme aligns well with government’s Parish Development Model and that it will bolster SACCO operations in the country.
The Commissioner Incharge of local economic development in the Ministry of Local Government Andrew Kamara noted that supporting ago processing will mean putting the many into the hands of the local communities for sustainable development through private sector partnership.
David Oringtoo, the Chairperson Deg-Mone Sacco in Amuru district commended the bank for training group members in business opportunities, management of loans, investment and banking services.
“I only knew about the Bank when they are taking away your land or assets because you can’t pay back the loan and this is the belief in the community that Bank takes away your property and they aren’t interested in borrowing and yet they have sunk of lands that they can’t develop,” Oringtoo said.
His counterpart Okello Hgaai, the Chairperson Amolatar Amule Development Saco revealed that they have already received 62 million unsecured loans for agro-processing and value addition.