Poor saving culture and mismanagement of funds have contributed to the collapse of most savings and credit co-operatives (SACCOs) in Katakwi district.
Savings and Credit Cooperatives are legal binding groups based cooperative financial institutions, where members can save money and access loans with an aim of fighting poverty.
Whereas in other districts in Uganda some of this institution is thriving – at the same time struggling, in the entire Katakwi district – only four are surviving.
Mr. Patrick Todi who’s the district commercial officer told our reporter that a total of forty two (42) SACCOs were registered in the district in 2006 but only four have survived to date.
The surviving saving institutions, according to Mr. Todi include; Katakwi Teachers’ SACCO, Engarakinobonik Toroma Women Empowerment SACCO and Katakwi High School Employees’ SACCO. All these saving and credit cooperatives are located in urban areas.
Todi attributed the collapse of the other six SACCOs to low savings, mismanagement of funds and cases of un-serviced loans by borrowers.
“There were serious cases of accountability which prompted most people to quit their SACCO groups. It will now take time for leaders to convince people to join SACCO groups again,” Todi said.
SACCO managers take.
Mr. Geoffrey Omolo, the manager Engarakinosbonik SACCO noted that there are some people who join SACCO groups with the aim of picking loan and disappear thereafter.
Omolo said most people begin to demand for loans even when their savings are much less than what they want.
According to Omolo, these people who want to get bigger loans than their actual savings are the ones who want to disappear on getting the money.
As a result, Charles Edangat, the board Chairperson Kaikamosing SACCO has called for intense sensitization on financial literacy with the aim of inculcating the saving culture in people since the spirit is still lacking among the members of the public.
He said that their SACCO’s survival is on the principle that they normally encourage their members to save and buy shares in order to get some interests and guarantee sustainability.
“Convincing people to buy shares and save with us has worked wonders because this is what has made us reach this far,” said Edangat.
Locals speak out.
“Members of the community shouldn’t be blamed for abandoning SACCO groups,” John Michael Ilemut said.
Ilemut argues that it is the abject poverty and high dependency burden that leaves most of them with too little or even nothing to save.
John Micheal Ilemut, is a resident of Oriau ‘B’ village in Magoro sub-county, Katakwi district.
He narrated that “you cannot convince me to save” when my needs alone overwhelm my earning unless you want me to die.
Another local – Immaculate Kongai said that poverty is to blame for the collapse of SACCOs in the district.
She said that it was difficult for most people to entrust the SACCO staff with their money because at some point, they would get no money at the time of withdrawal.