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High Costs Hindering Registration of Self Help Groups :: Uganda Radionetwork

High Costs Hindering Registration of Self Help Groups

In 2022, UMRA issued operational guidelines for Self Help Groups (SHGs) which include Farmer Field Schools, Farmer Groups, Savings, and Internal Lending Communities.
Edward Bindhe the Spokesperson of UMRA sensitising leaders of Self Help Groups in Luwero town on registration

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The Uganda Microfinance Regulatory Authority (UMRA) has blamed the high costs as a hindrance to the registration of Self Help Saving Groups.

In 2022, UMRA issued operational guidelines for Self Help Groups (SHGs) which include Farmer Field Schools, Farmer Groups, Savings, and Internal Lending Communities.

Others are Village Savings and Loans Associations, Rotating Savings and Credit Associations among others as defined under section 99 of the Tier 4 Microfinance Institutions and Money Lenders’ Act,2016.

Under the guidelines, Self Help Groups are supposed to register with the District Community Development Officer or the equivalent at the Municipality and City. The groups are issued with a certificate of registration valid for a period of one year and a maximum period of three years to be required to renew.

The objectives of the guidelines were to assist Self Help Groups in establishing financial stabilization mechanisms, increase transparency, and foster public confidence among others.

However, according to UMRA, many Self Help Groups are yet to register to date.

George William Namugera a member of Kakokoolo Tusitukiremu Development Saving Association in Luwero town says that the Self Help Groups especially in rural villages lack information about the significance of registration.

Namugera adds that failure to register the groups partly accounts for increased cases of embezzlement of members' savings.

Joseph Mukasa a member of Kamira Savings Development Association says that other Self Help Groups also believe that the 60,000 shillings paid to the district as registration fees, stationery, and transport costs are high.

Mukasa says that the groups don’t make so much profit to foot such costs and operational fees.

The SHG members are demanding that the government cap the registration fees at 20,000 shillings per year to encourage registration and renewal exercises.

There are over 2,000 Village Savings and Loans Associations (VSLA) across Luwero district.

Martha Mirembe a lawyer at FIDA Uganda branch office in Luwero town explains that they promoted the formation of 67 Self Help Groups in the district but the organization has since taken over the costs of registration after the members complained of what they called prohibited costs for the exercise.

Mirembe says that although the costs may look low, SHGs, especially in rural areas don't save or make so much profit to cater for such expenses.

// Cue in: “Where I am…

Cue out;…registration.’’//

Luganda Byte

Cue in: “Emitwalo omukaaga… 

Cue out;…ba registerinze”//

Edward Bindhe the Spokesperson of Uganda Microfinance Regulatory Authority said that they have got complaints that each district charges its own registration fees from 60,000-150,000 Shillings and this may be considered high to some Self Help Groups.

Bindhe said that as a result, UMRA has already written to the Ministries of Local Government and Finance seeking guidance on how to set uniform fees for all Local Governments to ensure SHGs can be able to embrace the registration exercise.

He also said they have embarked on sensitising SHGs with the help of Non-Government Organisations to ensure they embrace the registration exercise to help them streamline their activities.

// Cue in: “We have registered…

Cue out;…a lot of money”//

Luganda Byte

//Cue in: “Kuba Kati…

Cue out;…ssente nyingi nnyo.’’//  

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