Local National


Chrispus Mubale Muke

Recently Uganda Cooperatives Alliance Limited signed a Memorandum of Understanding with Housing Finance Bank aiming at making it easy for cooperatives to access loans and other Bank services. It takes us to reimagine, cooperatives in the 1960s whether they should be restructured making it more possible for cooperatives to get bank services in Uganda.

Globally, Cooperatives serve all categories of people, most especially the vulnerable category including women, youth, and Persons with Disabilities. Japan is a country with strong and longstanding cooperative traditions and in return, the cooperative sector offers no end of good options and opportunities in different fields

Research recommends that access to formal financial services by the population greatly contributes to inclusive in the money economy hitherto economic growth. The recent International Labor Organization (ILO) research provides evidence of the success of the cooperative model of enterprise to survive the crises and maintain the livelihoods of the communities in which they operate.

The research shows that in Europe, for instance, 4,000 local cooperative banks serve more than 176 million customers, 50 million of whom are members.

While European cooperative banks have 21 percent of the market share, they only accounted for 7 percent of all the European banking industry’s write-offs and losses during the recent financial crisis mainly due to their limited exposure to US subprime mortgages and fewer investment banking activities. If cooperatives own prosperous businesses why not change lives in Uganda?

In Uganda, Cooperatives are in excess of 31,000 in number serving over 10 million Ugandans majority of whom are engaged in different Agricultural value chains among other activities.

The MOU is in line with the United Nation’s Global Sustainable Development Goals (SDGs), Uganda’s Third National Development Plan, the Parish Development Model (PDM-Pillar No. 3 on financial inclusion), Uganda’s vision 2040, the International Cooperative Alliance Global Strategy, and the UCA strategic plan 2020/21-2024/25 and also in line with Uganda’s National Financial Inclusion Strategy (NFIS) 2017-2022, a holistic strategy for promoting financial inclusion with an emphasis on five pillars:

These pillars include; Reducing exclusion and barriers to accessing financial services, Developing the Credit Infrastructure, Building digital Infrastructure that aims at enhancing the use of technology in cooperatives, Deepen and broadening formal savings, investment, and Insurance usage, Protect and empowering individuals with enhanced financial capability.

The partnership also includes that the Cooperative Insurance Company (CIC) will provide a competitive insurance package to Cooperators through Housing Finance Bank.

The above is as well the biggest most recent opportunity for cooperatives to get included in the money economy and grow at the firstest speed possible to satisfy  growth needed for economy recovery and growth that will deliver Uganda to the middle-income status.

It also allows cooperatives to get bulky loans which they can later lend their individual members so that they can improve their lives. This would make the members traceable for the bank since they have an umbrella that brings them together rather than failing to be access the money in person since banks refer to them as risky. Remember some members also fear using bank services at individual level.

This is therefore to recommend all Cooperatives in Uganda to embrace this initiative to be able to keep money in circulation hence joining the money economy (For those who are not most especially those in Agriculture), get access to a wider range of financial products that will upgrade citizens to the money economy.

Once the above are impressed, it will increase the savings rate of the citizens, improve the economy and lead to development hitherto entering the long-awaited for ranks of the middle-income status.

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