Government orders self-saving groups to register

Government has issued new guidelines for self-saving groups across the country and directed members to register with the government.

The move that is aimed at protecting people’s savings from unscrupulous leaders who have been running away with money, will see all Saccos register with the district community development officer effective January next year.

Addressing journalists at the Uganda Media Centre in Kampala on Tuesday, the executive director of Uganda Microfinance Regulatory Authority, (UMRA), Ms Edith Tusubira, said upon registration, the groups will be issued with certificate of registration.

The certificate shall be valid for a minimum of one year, subject to renewal until the members decide to close the group.

According to the other guidelines seen by this publication, the groups will also be required to submit a fully-signed constitution or by-laws, a recommendation letter from the LC1 and the national identity cards for the group’s leadership.

The groups will also be required to submit details and modalities on how much each member saves, for how long and how the money is shared among group members.

Who gets what and when should also be submitted to the government, as well as the details of the group’s leadership structure. 

“We advise all the self-saving groups to follow the guidelines if they want their savings protected. We have seen people at the village level saving their money and at the end of the year, the chairpersons run away with the money,” Ms Tusubira said.

Self-saving groups are unregistered Saccos where people save their money monthly, weekly or on a daily basis and lend among themselves. These are mostly used by people, especially women in the informal sector and in rural areas, who do not have access to banks.

Unlike Saccos that are registered and licensed by UMRA, the groups will be given certificates by their respective districts, which will then report to UMRA.

On the fees for registration of the self-saving groups, UMRA acting director for supervision Nelson Mutatiina, said the minister of Microfinance will issue a statutory instrument stipulating the standard fee each group will pay to register.

He, however, said currently, districts are charging between Shs50,000 and 100,000 per group.

The State minister for Finance, Mr Haruna Kasolo, encouraged people to register their groups for their own safety.

“You will no longer lose your savings at a group level, your money is going to be saved. In Kenya Saccos dominate in the economy and we want the same in Uganda,” Mr Kasolo said.

He revealed that only 19 percent of Ugandans save with formal banks, hence the majority are saving with Saccos and self-groups, hence necessitating regulation.