Posted on July 15, 2009 - by boris

BoU warns against unlicenced financial firms…

Daily Monitor posted:

Bank of Uganda has warned the public not to save their money in unlicenced microfinance institutions.

The Executive Director, Supervision BoU, Ms Justine Bagyenda, while commissioning Finance Trust Limited’s new branch at Kalerwe – a Kampala Suburb – last week said; “There are so many gift Saccos, which have sprung up and promise you a lot of returns when you save with them. These are hoax institutions which want to take away your hard earned money.

“People need to work hard in order to get rich not to look out for easy money. Never put your money in these institutions which are not licenced and have BoU certificates in their offices to avoid disappointments,” Ms Bagyenda said.

This call comes at a time when the global economic crisis is still raging and people are in dire need of developing money sources.

Ms Bagyenda said the finance industry is experiencing a challenge with regard to savers. The number of accounts currently stands at 3.5 million; a figure far below BoU’s expected 12 million bankable accounts.

She said in order to ensure that this number increases, BOU is partnering with commercial institutions to ensure that saving services are brought closer to the people. Finance Trust is one of the first few credit institutions accredited by BoU.

The bank started operations in 1984 and has seen a total of 110,000 savers with savings balances in excess of Shs12.4 billion. It has a total of 18,000 active borrowers with a loan portfolio of Shs22.6 billion.

The Chief Executive Officer, Mr Matthias Katamba said the public needs to participate in the growth of the economy. “We would like to see you grow your businesses, send your children to school at the beginning of the school term, build permanent homes and achieve your dreams,” Mr Katamba said.

Ms Ida Wanendeya a director and one of the founder members, said the reason why they came up with a women finance bank was because of the challenges women experienced when they wanted funds to start.

“Many women were asked for securities in form of land titles and other assets which they didn’t have. This is how we came up with this idea which has grown to even accommodate the men too,” Ms Wanendeya said.

Source:http://www.monitor.co.ug/artman/publish/business/BoU_warns_against_unlicenced_financial_firms_88044.shtml