A poor understanding of the concept of Savings and Credit Cooperative Organizations is hindering the implementation of the Prosperity for All program, the union established to manage the program has observed.
Savings and Credit Cooperative Organizations (SACCOs) are member-based groups, established throughout Uganda as a means for government to disburse funds under its Prosperity for All program. Prosperity for All, known in vernacular as Bonna Bagagawale, consists of funding directed at improving household incomes through small scale businesses and farming enterprises.
Each SACCO established, must have trained staff and basic start-up capital contributed by members, to qualify for Prosperity for All funding. The funds are equally distributed to SACCO members as minimal-interest loans to boost their business endeavors.
Kyaka Twaha, the field operations manager at Uganda Cooperative Savings and Credit Society Union, the umbrella organization for all SACCOs, says 113 SACCOs received government funding last year. He says an additional 146 new SACCOs will be funded by Bonna Bagagawale this year.
Despite this, Twaha says there is still a great lack of understanding on the concept of SACCOs. He explains that SACCO members are unaware that funds given to them are not grants, but loans that must be paid back.
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Richard Mugenyi, the board secretary of Uganda Cooperative Savings and Credit Society Union, says there is a need for greater training for SACCO managers to understand their role in order for the benefits of Bonna Bagagawale to spread throughout the country.
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Mugenyi says it is important for SACCO managers to encourage their members not to rely completely on Prosperity for All to kick-start their businesses, but to look to other enterprising ways of raising capital and ensuring the sustainability of their projects.