With green growth and sustainable development becoming a new trend in the world, Ugandan bankers have been urged to join the movement so they contribute to tackling climate change.
“While there is growth in economic activities, the downside is that they are affecting the environment and we are beginning to feel the impact in unprecedented ways. We as financers have the responsibility of guiding and ensuring that economic activities, we support are climate smart, green and sustainable methods of doing business,” Hannington Wasswa, the director commercial banking at Bank of Uganda (BoU) said.
He was on Friday speaking during the Annual General Meeting and 10th graduation ceremony for the Uganda Institute of Banking and Financial Services in Kampala.
Last year, BoU said it had started the process of designing a policy and regulations to guide commercial banks on green finance to guide the financial sector on implementing green financing.
The Central Bank said commercial banks have not been able to implement green financing due to lack of guidance and that the policy will help streamline this.
Speaking on Friday, the BoU director for commercial banking said it is prudent that commercial banks interest themselves in green financing in form of project financing with additional areas such as capital markets linked to environmental, social, and corporate governance.
On the other side, commercial banks can get involved in transaction banking which involves trade finance and how big corporations transact with small- and medium-sized enterprises, and how these transactions are financed by banks.
“We must intentionally ensure that we measure our progress and impact internally and for our customers. There are standard ways of doing this and every banker ought to be sensitized, trained and if possible certified in this very important field,” Wasswa said.
The official from BoU said other areas of concern that the Uganda Institute of Banking and Financial Services and bankers in general ought to critically look at are money laundering and cyber attacks which create a great risk for the economy.
He commended the bankers’ institute for engaging with the Financial Intelligence Authority to come up with relevant programs for all stakeholders in the sector.
“I also note that the institute’s courses on cyber security should be similarly embraced by everyone as the economy continues to grow.”
According to Michael Mugabi, the chairman of the board of the Uganda Institute of Banking and Financial Services, embracing green financing is high on their agenda.
“We have engagements with aBi Finance and also signed an MOU with them where the institute was taken on board as a training partner for this fund. We must continue to be seen as not being only profit driven but as those that play a key role in underpinning the economy by championing funding, financing and solutions that speak to the vulnerable communities, climate change and environment,” Mugabi said.
Mugabi noted that in the past one year, they have contributed to issues affecting the banking and financial sector in terms of capacity building.
Graduation
During the same function, 54 students graduated in different disciplines from the bankers’ institute during the 10th graduation ceremony.
According to Goretti Masadde, the chief executive officer of the Uganda Institute of Banking and Financial Services, the 10th graduation was unique.
“What is unique about the 10th graduation is that we have graduated the two pioneer executive bankers who have finished our second level of the chartered banking program which is the premium program for anybody who wants to get into banking. This is important for the industry because banking is critical for the growth of the economy and financial well-being of our people,” Masadde said.
“When we have professional bankers, we are able to support individuals and businesses. This is professionalizing which puts ethics, competence and capability in place. These are wholesome bankers who understand the customers’ needs , advise them, dissect the issue and give what is the best for them. These people are supposed to be customers’ best relationship managers as far as banking is concerned.”
Also graduated who were undertaking the Microfinance apprenticeship program funded by DSIK, a German international organisation supporting SACCOs and microfinance institutions in Uganda.
Ten apprentices from different microfinance institutions were the beneficiaries of the program and have graduated with a Professional Certificate in Microfinance from the Institute of Banking and Financial Services.
Zachary Kansiime the capacity development advisor at DSIK (Deutsche Sparkassentiftung fur internationale Kooperation) said, “this is the first group of graduant with hands on practical skills in the Microfinance sector. The plan is to increase expertise within the sector.”
The microfinance sector reaches out to majority of the community members that donor use banks or any other formal financial service providers.
