Cooperative and SACCO leaders in Kapchorwa and Kween districts have been urged to take advantage of affordable government loans offered by the Microfinance Support Centre (MSC) and avoid money lenders accused of exploiting communities through exorbitant interest rates.
The call was made during a regional financial literacy and loan clinic held at Kapchorwa District headquarters, where more than 200 leaders from over 50 cooperatives, SACCOs, and Village Savings and Loan Associations (VSLAs) from Kapchorwa and Kween districts participated.
The training was conducted by MSC as part of its ongoing nationwide loan clinic programme aimed at improving financial literacy, bridging information gaps, and strengthening cooperatives.
Denis Odeba, an official from MSC, said the loan clinics are intended to close the information gap that has left many communities vulnerable to exploitative money lenders.
“The reason we conduct these trainings before giving out loans is to bridge the knowledge gap. Now that you are aware that Microfinance Support Centre offers loans at up to 8% interest per year, this will enable your cooperative and business to grow,” Odeba said.
He warned that many people are trapped by money lenders charging excessively high interest rates.
“Why go to loan sharks who charge up to 40% interest per month? It is purely due to lack of information,” he said.
Odeba added that MSC loans are affordable and accessible to cooperatives that meet the required conditions, noting that loan processing timelines have been reduced.
“Our turnaround time is short. Once you meet all the requirements, we can process your loan within a month or even less than two months,” he said.
He also encouraged cooperatives to utilize the free advisory services offered by MSC, adding that government programmes such as Emyooga and grants are available to support income generation and community development.
Toskin Silver Bomet, the District Commercial Officer for Kween District, warned that money lenders have contributed to the collapse of many businesses and cooperatives.
“We have private money lenders charging interest rates of 20%, 18%, 15%, or even 10%. In the end, many borrowers fail to repay,” he said.
Bomet noted that poor governance, inadequate training, low capitalization, and climate-related challenges are also affecting cooperatives in the region.
He emphasized the importance of training before accessing credit.
“It is important because once someone gets money, the original purpose can easily change, and they end up spending it on things they never planned for,” he said.
He urged farmers and communities to rely on government-supported financial institutions.
“My message to farmers and communities is to embrace government programmes like the Microfinance Support Centre. They provide affordable loans that will not hurt your business,” he said.
John Kusuro, a participant from Kapchesombe Green Change Farmers Cooperative Society, said the training had opened their eyes to the availability of government financial support and the dangers posed by money lenders.
“Most people did not know that there is financial support provided by the Microfinance Support Centre,” Kusuro said.
He added that many residents have suffered due to high interest rates charged by informal lenders.
“Our people are struggling with loans and high interest rates. Some even lose their property or flee because of pressure from lenders,” he said.
Kusuro said MSC loans are far more affordable compared to those offered by informal lenders.
“We are now aware that Microfinance Support Centre provides loans at 8% per year. This is very affordable,” he said.
Participants also appealed for such trainings to be conducted regularly to continuously equip cooperatives with financial knowledge.
“We pray that these trainings are conducted regularly, perhaps quarterly, because many of our offices are understaffed and cannot reach every community,” one participant said.
MSC confirmed that the loan clinic programme is ongoing across the country, having already covered the Busoga and Bugisu regions, with upcoming engagements planned for Masaka and other regions.
Officials said the goal is to ensure that no region is left behind in accessing financial literacy, affordable credit, and government support programmes aimed at strengthening cooperatives and improving household incomes.
