Bank of Uganda has proposed amendments to the Microfinance Deposit-Taking Institutions Act to regulate at some 42 Savings and Credit Cooperative Societies (Saccos) whose savings have hit Shs1.5b.
The new regulation will be effected under the Micro Finance Deposit-taking Institutions (Registered Societies) Regulations, 2022.
Dr Tumubweinee Twinemanzi, the Bank of Uganda Executive Director Supervision, said cabinet had already considered and approved the new amendments to the Microfinance Deposit-Taking Institutions (Amendment) Bill, 2022; and authorized the Minister of Finance to submit the Bill to Parliament for enactment . He was speaking at the second Central Bank Financial Stability Symposium,
“On [November 22], the minister presented the Bill for First Reading in Parliament. Key amendments proposed in the Bill include: Permitting [Micro Deposit-taking Institutions] to extend their services through agents, provide insurance services and products through Bancassurance and [offering] Islamic finance (Islamic microfinance), among others,” he said .
Under the Tier 4 Microfinance and Money Lenders Act, 2016, the Central Bank is also mandated to provide supervisory oversight over Registered Societies with voluntary savings in excess Shs1.5b and institutional capital of above Shs500m.
He said that Bank of Uganda together with Ministry Finance and First Parliamentary Counsel had finalised drafting the Micro Finance Deposit-taking Institutions (Registered Societies) Regulations, 2022.
“The regulations have been approved and gazetted. Bank of Uganda with the Registrar of Cooperatives shall conduct country wide sensitisation campaigns on the Microfinance Deposit-Taking Institutions (Registered Societies) Regulations, 2022 ahead of anticipated licensing activities,” he said.
Dr Twinemanzi also said Bank of Uganda had completed guidelines that will guide implementation of Credit Reference Bureau (CRB) Regulations, 2022.
