Teachers have requested adjustments to credit terms in Umwalimu Savings and Credit Cooperative (Umwalimu SACCO) and consider extending the repayment period from three years to five years so that the increased salary advance loan benefits many of them. They made the appeal on Wednesday, during the 25th General Assembly of Umwalimu SACCO held in Kigali. The management of this financial institution announced during the Assembly that the maximum loan a teacher is entitled to was increased from Rwf3.5 million to Rwf5 million. This follows the increase of primary school teachers' salaries by 88 per cent and those of secondary school teachers by 40 per cent in August this year, as well as the Rwf5 billion Government's contribution that boosted the liquidity of Umwalimu SACCO. Laurence Uwambaje, Director General of Umwalimu SACCO said it was realised that over 20,950 members (teachers) will be entitled to the increased loan as they have the required capacity to get from Rwf3.5 million to Rwf5 million. After getting such statistics, we considered what impact lending such money within five years as the repayment period would have on Umwalimu SACCO, she said, pointing out that the recovery of the loans would take a long time, which would weaken the institution's financial flows and liquidity. That made us maintain a three-year repayment period so that the money is recovered within short cycles for us to be able to respond to the loan needs of the members, she said. Uwambaje disclosed that the financial institution was trying to get means to meet the increased financial needs of many teachers who requested higher loans after salary increments. “This year, we expected that we would provide Rwf93 billion in loans. But, because of the raise of teachers’ pay, we by far exceeded that expectation as we had disbursed Rwf137 billion in 11 months (as of November 2022),” she said. The money lent to teachers so far represents about a 40 per cent increase compared to Rwf98 billion that she said was disbursed last year. Fidel Nsanzamahoro, a secondary school teacher from Gisagara District told The New Times he gets Rwf256,000 salary per month, from Rwf166,000 before salary rose in August this year. He said the teachers who could afford the Rwf5 loan ceiling are those earning about Rwf300,000 per month, pointing out that a teacher cannot exceed 50 per cent of their monthly salary while paying back the loan they were given under Umwalimu SACCO. This is the case because it is estimated that a teacher would use the remaining 50 per cent of their salary to meet their basic needs. Nsanzamahoro said he wanted to get such a loan amount in order to expand the veterinary pharmacy business that he runs together with his wife. “The veterinary pharmacy business is profitable, but, this loan requirement is prohibitive for me to access the needed financing to grow it for greater proceeds,” he said. “If the five years are not applicable, the loan repayment period should be four years, or if the three years are maintained, other adjustments such as raising the percentage of salary that a teacher can spend on loan repayment to, say, 65 per cent or 70 per cent from the current 50 per cent,” Nsanzamahoro suggested. Meanwhile, figures from Umwalimu SACCO show that its total assets grew by 30 per cent from Rwf110 billion as of November 2021 to Rwf143 billion as of November 2022. On return on investment, Uwambaje said that its profit before tax payment was Rwf12.2 billion as of November 2022, which is 25 per cent higher than the Rwf9.8 billion registered in the same period of last year Loans from Umwalimu SACCO are charged at 13 per cent interest rate per year for public teachers, and 14 per cent for non-public teachers members, information from the financial institution indicates. Meanwhile, again on Wednesday, Umwalimu SACCO launched digital products including internet banking, online emergency loan and e-tax payment, which it said are in line with ensuring efficiency in financial service delivery to its members and customers.