MBARARA –Geoffrey Mutebi, the District Commercial Officer of Mbarara, has suggested that loan applications for Emyooga seed money should be pegged to personal property to guarantee successful recovery of the money.
Mutebi made the proposal recently during a talk show on Radio West which was sponsored by The Uhuru Institute for Social Development.
He said the Presidential Initiative On Job And Wealth Creation, Emyooga, is designed to prop up a saving culture among Ugandans and is different from programs like the Youth Livelihood Fund, National Agriculture Advisory Services (NAADS) and Operation Wealth Creation (OWC), which never really changed people’s livelihoods.
“Research shows that 68% of Ugandans still work for the stomach but the Emyooga seed money is meant to focus on the economy where 18 SACCOS in each constituency will be given capital for development,” Mutebi said.
He said all 353 constituencies in Uganda will get a share of government’s Shs 260 billion start-up capital.
“As Mbarara district we have two constituencies; Kashari South and Kashari North, which got Shs 1.2billion that will be divided among the 36 SACCOs,” he said.
Mbarara City received Shs 1 billion in December 2020, which was divided equally between Mbarara North and Mbarara City South divisions while Rwampara district received Shs 1.4 billion for all the 36 emyooga SACCOs in its two constituencies.
“Each constituency formed 18 SACCOs and each SACCO has a start-up capital of Shs 30million,” Mutebi said.
Enock Kerere, the co-panelist and Chairperson of Kashari South Restaurant Owners Emyooga SACCO, said recovery of the Emyooga seed money may be difficult because members have not put up any collateral to guarantee the loans.
“It’s not a revolving fund, its start-up capital but paid at least after three months so how will one pay back when there is no property attached?” Kerere added.
Alex Kibirige, the Chairperson of Kamukuzi Preforming Artists Association, told theCooperator that Emyooga SACCO leaders may be arrested to force them to settle members’ debts.
“Chances of us getting imprisoned will be high because there is no clause for collateral. We are even likely to see the leadership refusing to issue loans because they do not trust members in their Emyooga groups, meaning the money will not be fully utilized,” Kibirige explained.
“How will I give you money when I don’t know your character much as we are dealing in similar skills? What if you default, who will be handcuffed, automatically it will be the chairperson,” he added
“Members still think the money is for sharing and celebrating the election victory (of NRM) since the program came during election time, so you can’t tell them to pay back,” he said.
Kibirige said the money disbursed is too little compared to the number of SACCOs.
“For instance our group requested for Shs 6 million but we were only given Shs 1 million yet we are 22 members. So how do you share one million amongst all those members?” Kibirige said.
Each cluster of skilled SACCOs in constituencies will be given Shs 30 million to cater for multiple groups.
“Remember we removed almost shs 500,000 for operational costs such as transport, printing the constitution, renting an office. I am even stuck with Shs 500,000 on our account because I don’t know how I can distribute it to all members” he said.
He advised the government to re-invest this money in already existing SACCOs to boost their portfolio instead of starting up new ones.
“Our mother SACCOs are already performing and they are established. They are not struggling like our Emyooga SACCOs, why don’t you empower them on condition that they reduce their interest rate such that more members can join? Because all these Emyooga SACCOs were not given a standard interest rate, some are already charging high interests compared to already existing SACCOs,” he said.
“Some are charging 5%, ours is charging 3% but EBO SACCO is charging 2%, so how will these Emyooga SACCOs compete? Actually those that will survive for a year will be few or none,” he said.
Mutebi said emyooga is here to stay.
“I want to explain to Ugandans that this program is meant to change our living conditions because Ugandans are known for working for a daily meal forgetting the next day, so we want to turn this program into a success,” Mutebi said.
“An average Ugandan will learn how to save, how to work and borrow money to improve his or her household income,” Mutebi explained.
Kerere said the disbursed Shs 260 billion has already created an economic impact in communities.
“This is a lot of money in saturation that will not leave the country the way it is. For instance landlords who had their rooms unoccupied in Bwizibwere have already started celebrating as there are over 18 Emyooga offices are already in existence,” he said.
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