Cooperatives in Uganda have long served as engines for economic growth, poverty alleviation, and social transformation. From agriculture to finance and consumer services, cooperatives play a pivotal role in improving the livelihoods of millions of Ugandans, particularly in rural areas. They foster collective action, enhance access to resources and markets, and promote financial inclusion among marginalized communities.
Uganda’s cooperative movement is diverse and dynamic, encompassing various sectors such as agricultural marketing cooperatives, Savings and Credit Cooperatives (SACCOs), worker cooperatives, housing cooperatives, and consumer cooperatives.
These member-owned organizations provide a platform for individuals especially smallholder farmers, traders, and micro-entrepreneurs to pool resources, improve their bargaining power, access affordable credit, and participate more competitively in markets.
Agricultural cooperatives are particularly critical as they help farmers access inputs like seeds and fertilizers, provide storage and processing facilities, and collectively market produce to fetch better prices. SACCOs, on the other hand, offer crucial financial services to members who are often excluded from the formal banking system. They promote a culture of saving and investment, enabling members to finance small businesses, pay for education, and meet health emergencies.
According to the Ministry of Trade, Industry and Cooperatives, Uganda is home to over 21,000 registered cooperatives, employing thousands of people and supporting millions indirectly. The sector remains vital in achieving Uganda’s development goals, including Vision 2040 and the National Development Plan.
Despite their contributions, many cooperatives and small enterprises face challenges related to access to affordable finance. In response to these concerns, State Minister for Microfinance, Haruna Kyeyune Kasolo, has reiterated the need to establish a Cooperative Bank to support small and medium-sized enterprises (SMEs) and relieve them from the burden of exorbitant interest rates charged by commercial banks.
Speaking at a recent cooperative event, Minister Kasolo emphasized that one of the greatest barriers facing SMEs is lack of access to reliable and affordable credit facilities.
He revealed that his ministry is actively considering the establishment of an apex bank for all cooperative societies and unions to help address long-standing challenges in the credit market.
“Our assessments have established that besides the exorbitant interest rates, many micro and medium-sized business operators are also frustrated by the high-value collaterals and other inconsiderate conditions imposed by commercial banks,” he noted.
Kasolo underscored that a cooperative-owned bank would serve as a direct financing channel through which government could capitalize and empower cooperatives. It would also reduce bureaucratic tendencies and support targeted funding for income-generating projects in rural areas.
“It is high time we mobilized our cooperatives into their own bank one that meets their unique credit and capital needs. Through such a bank, we can ensure sustainable financing for grassroots economic transformation,” he added.
The minister further called on Ugandans to fully embrace government-backed development initiatives such as the Parish Development Model (PDM) and the Emyooga Programme. These interventions are designed to enhance household incomes, improve service delivery at the grassroots, and uplift communities from subsistence to market-oriented production.
Kasolo emphasized that achieving economic transformation requires discipline in financial management, particularly in adopting a saving culture.
“The money you eat is not more important than the money you save. We eat every day but are never satisfied. Saving must become a priority because once money leaves your hands, it will never be yours again,” he stressed.
He advised Ugandans to avoid the trap of impulsive consumption and instead develop work plans, set income targets, and define saving goals to guide their expenditure.
“Please learn to sacrifice. Spend your earnings only when necessary. If you cannot control your appetite, you will eat the PDM money, eat the Emyooga money, and still remain poor. Sacrifice is the key to wealth creation.”
Minister Kasolo also warned beneficiaries of government programs against misusing public funds meant for development. He expressed concern that some individuals who had already received support through Emyooga were now seeking to benefit again under the PDM, contrary to the design of the programs.
“What disturbs me is that people who already benefitted from Emyooga are now parading themselves for PDM. That is criminal and must not be tolerated. Such people should be arrested,” he said.
The Emyooga Programme, launched in 2019, is a presidential initiative aimed at supporting 19 categories of beneficiaries engaged in various enterprises such as boda boda riders, market vendors, carpenters, performing artists, salon operators, and tailors. It provides seed capital through SACCOs formed around these occupational groups, enabling members to borrow, invest, and grow their businesses.
In contrast, the Parish Development Model, a more recent intervention, targets entire parishes as units for economic development and is geared towards transitioning households engaged in subsistence farming into the money economy.
Kasolo emphasized that these programs, if properly utilized, can be powerful tools for poverty eradication and inclusive economic growth. However, their success hinges on mindset change, transparency, and responsible financial behaviour.
As Uganda celebrates Coops Day and reflects on the importance of cooperatives, it is clear that the sector remains indispensable in the country’s pursuit of socio-economic transformation. For cooperatives to realize their full potential, there must be continued investment in capacity building, access to affordable financing, digitalization, and good governance.
Establishing a Cooperative Bank would be a game-changer in addressing the structural bottlenecks that hinder the growth of small enterprises and rural-based cooperatives. Equally, instilling a savings culture among citizens and ensuring proper use of government funds will catalyse development at the grassroots.
