Rwanda Cooperative Agency (RCA) yesterday launched a confederation of cooperatives which will be charged with educating, advocating and arbitration to improve performance of cooperatives in the country.
The development comes after RCA noticed a tremendous improvement in cooperatives despite recent cases of mismanagement and misappropriation of funds in several cooperatives.
Some leaders of cooperatives were arrested and ordered to pay back millions of swindled funds.
“Cooperatives have tremendously improved to the extent that some have started sharing meaningful dividends,” Vincent Rutaremera, the Director of Planning and Cooperative Capacity Building said yesterday.
“The confederation comes at the right time when cooperatives need strengthening. Over two million members from the middle class benefit from the cooperatives and they can play a major role in the country’s economy”
Statistics suggest that the shared capital of cooperatives in Rwanda has grown to Rwf12 billion as of September this year.
According to Rutaremera, the number of cooperatives is also increasing, which, he said, indicates that Rwandans are slowly adopting the saving culture which has helped many fight poverty.
He revealed that the current number of fully registered cooperatives vary between 3,000 and 4,000.
Rutaremera also warned against briefcase cooperatives.
“Of recent we had discovered that some of these ghost cooperatives mobilize members’ contributions and disappear,” said Rutaremara.
Some of the leaders of the mismanaged cooperatives have been prosecuted and government has offered to pay back the members’ deposits.
The saving mobilization in Rwanda is expected to grow further with the current creation of village savings and credit cooperative societies (Umurenge SACCOS) in 416 villages.
The Central Bank estimates that only 21% of the population in Rwanda access financial services. Some of the successful cooperatives in Rwanda include Banque Populaire Du Rwanda, a SACCO that has grown into a commercial bank.
Others include the security forces’ Zigama CSS that the Central Bank had proposed, be transformed into a commercial bank because of the strong financial muscle it wields in the Rwandan economy.