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Focus on Uganda Part 1: The importance of being able to set up savings accounts for youth in Uganda


Sally Hartley, who is doing research for the Co-operative College in Uganda, reports on youth co-operatives in the country.

I am here in Uganda doing some research for the Co-operative College in Manchester and the Open University on young people and how they are involved with co-operatives. Co-operatives have been around in Uganda for 100 years or so, mainly farmers co-operatives which have helped farmers improve their business by enabling them to market and sell their goods as a group, helping them command higher prices and also buy supplies such as fertiliser together and in doing so save themselves money.

These days the majority of co-operatives are still farmers' co-operatives but there is a rapid growth in co-operatives that offer savings and credit, commonly known as SACCOs. These co-operatives aim to provide financial services to people in hard to reach and often rural areas where there is often a lack of banks or building societies. This means that people have nowhere to put their money and also no access to money to help start or support their businesses or sources of money to draw on in times of emergencies. One of the central ways that SACCOs work is to get people to save some money first and then take a loan – this process of saving helps them develop a savings habit, which also involves them learning how to plan for the future rather than living day to day.

One of the youth co-operatives I am working with is JoyFod SACCO. They are based in Buwenge sub-county in a small village called Igombe. They have over 600 members who have savings accounts with them and who are also taking loans from them. Differently to other SACCOs, they specialise in opening accounts for young people.

Youth in Uganda are defined as those people between 18 – 30 years old and they make up 78% of the 32 million population. SACCOs in other areas often face a challenge in loaning money to young people – they say that young people are not serious enough to manage a loan and as a result they often fail to repay it. JoyFod believes that young people can save and manage loans if given the right support.

JoyFod therefore provides training and sensitisation to young people on how to save and why to save and helps them think about which business would be the right one for them to invest in. They say young people should invest in businesses that they are currently doing and that suit their lifestyle – such as selling vegetables, bicycle or motor bike taxis, rather than coming up with ideas that do not fit their skills or the needs locally.

They also believe the biggest challenge facing young people is getting a job – unemployment rates are very high here, particularly for young people – and without a job or a way to generate some income they cannot pay their school fees or progress in life. JoyFod believes providing financial services to young people not only gives them a way to make an income but helps them develop themselves and their life.

Mohammed Ngobi

Mohammed Ngobi is a 29 year old living nearby Igombe Village. He opened a savings account at JoyFod five years ago and since then he has been saving and has taken several loans to help him improve the little shop he runs near his home. He stocks drinks, biscuits, candles, matches and other household items.

Being a member of JoyFod has meant he has attended training in the importance of saving and also how to keep records for your business. He believes record keeping has enabled him to keep a track of his stock but also give him an idea of the profit or loss that he is making. He is also better able to keep account of his customers and when he has offered them credit and when he needs to follow up on that. The growth of his business and his commitment to saving has enabled him to accumulate enough money to further his education and he has recently completed his O levels.

Mohammed presents a picture he has drawn of the impacts on his life of the co-op at a group discussion

Continuing education later in your life is common to youth in Uganda as young people often have to drop out of school as they lack the funds to pay for it. People have to pay for secondary education and, whilst primary education is free, you still have to pay for uniforms and books and many people cannot afford this.

Mohammed now plans to keep saving and is hoping to complete a diploma in business and at the same time keep expanding his shop and improve his farming through the set up of a farmer co-operative in his area.