By Allan Bamuha
Cooperative societies play a key role in promoting savings and credit facilities world over. They act as an instrument to provide savings and credit services thereby raising the standards of living for the masses. Parish Development Model and Emyooga SACCO’s in Uganda are such development engines aimed at uplifting the vast population into money economy
SACCOs bring more people into the financial arena. They have gained pace as a major component of the financial system in Uganda. The grassroot has been energized as more and people are yawning to be part and partial of the super economic programs
The government of Uganda has taken the PDM and Emyooga financial strategy to the lowest grassroot. The cardinal aim is to serve the people with lower incomes who would face challenges to access finance from banks.
PDM and Emyooga programs will contribute to the socio-economic development of men, women, youth-the skilled in both rural and urban areas of the country. The growth of these SACCO’S becomes center piece of development and important as they continue to empower the grass root communities
For cooperatives identifying and applying growth strategies, it can help them gain competitive advantage. The following strategies can impact on the performance of SACCOs enabling them to achieve their mission.
Cooperatives should embrace good operational policies, these are general directives to define strategies and guide decisions to achieve the set goals. They help smoothen the operations and address mistakes and hiccups in the process. It should be noted that developing good operational policies is essential for SACCOs as it can lead to a progressive environment, quality services, and consistent member support.
Product Innovation is key in strengthening cooperatives. Product innovation involves developing or improving products and services. SACCOs product innovation can include flexibility in applying and repaying loans, and processing loan applications but at an advanced stage insurance and different types of loans can be introduced.
Offering new products and services can be valuable for SACCOs as it can increase revenue. It can also create additional value for the members and make the process more effective and efficient while accessing financial services.
SACCOs can adopt diversification in response to the changing environment to enhance competitiveness eg encouraging viable ventures to associations or enterprise groups at the grass root levels. SACCOs can adopt policies and procedures that can help them enhance efficiency and product diversification.
Expanding the target market through seeking new customers or markets willing to engage with the existing products and services or ventures proposed, for example PDM is looking at grassroot agricultural engagements which to a large extent is much welcomed especially by the grassroot communities . SACCOs may involve in moving to new markets or sectors to attract new members. This can be done by offering new kinds of services or more affordable loans to non-members.
Cooperative societies in are operating in a highly competitive and dynamic environment. They face direct competition from banks and financial institutions in offering loans and credit facilities. In order to respond to the challenges, adopting these strategies can help SACCOs meet members’ demands. And become more innovative in their ways of approaching the changing environment.
Never the less globally the following are the generally acceptable principles of a good SACCO as far as governance is concerned
Members’ participation is essential for effective and efficient governance and management. All members shall have a voice in the decision-making process either directly, or through the organs that represent them. Such participation shall be free of intimidation, duress or undue influence.
2) Transparency and Easy Access to Information
All processes, decisions and relevant information shall be transparent, and accessible to all those concerned. Governance organs shall hold regular meetings to direct the SACCO’s affairs. In this respect, the Board/Committee and its Sub-Committees shall meet at least once a month, while the General Meeting shall be held at least once a year and in any case not later than 3 months following the close of the SACCO’s financial year.
For issues that require special resolution, like changing bylaws, all members shall be invited. Similarly, the Supervisory/Audit Committee shall meet regularly to provide effective supervision of the SACCO’s operations and general business.
All decision makers shall be accountable to immediate supervisors and higher organs and ultimately, to the members and communities.
4) Consensus Orientation
The different organs and officials shall endeavour to reach consensus on all matters critical to the SACCO’s operations. This will be achieved through a participatory approach, transparent systems and operations, and full accountability to the members. Leaders there in shall be open to differing view points.
5) Efficiency and Effectiveness
The SACCO’s governance organs shall have policies, processes and procedures that produce results that meet the needs of members. Hence, the SACCO’s resources shall be used efficiently.
All members shall have equal opportunity to benefit from the SACCO’s services. The members, without discrimination shall feel they are treated with utmost fairness at all times.
7) Respect for Rules, Policies and Regulations
The legal framework and policies under which the SACCO is regulated and operates shall be respected strictly and impartially enforced. The SACCO’s By-Laws and operating policies and regulations shall always be complied with. They will be made known to all members at all times.
8) Strategic and Visionary Leadership
The SACCO shall have leaders and management with a vision for and commitment to the organisation, and passion to improve their members and the communities in which they are based. Their character and past record shall be free of any unprofessional reputation.
9) Knowledge and Skill in Leadership and Management
The members of the governance and management organs shall be knowledgeable and trainable in SACCO governance, management and operations.
10) Organisational Growth
Governance organs shall focus their efforts on SACCO growth, both in size and operations. Continued growth will result into the SACCO’s survival and sustainability in the long term
The Author is the Deputy Resident City Commissioner Fortpotal City North Division