The Ministry of Finance announced, early this week, that Umurenge SACCO—an initiative aimed at extending microfinance services to the low income segment in Rwanda has managed to save more than Rwf10 billion by the end of the first quarter of 2011.
With 1,155,000 registered members, the initiative is turning out to be one of the most effective community empowerment programmes that the government has used to remarkably facilitate economic and social growth as well as reduce poverty.
The programme was designed to address low domestic savings and financial exclusion of a larger perceentage of the population, especially rural communities.
It is also in line with the national microfinance policy, the nationalmicrofinance policy implementation strategy, and the national savings mobilisation strategy.
However, recently members of Parliament expressed concern over various challenges within Umurenge SACCO including, ownership, infrastructure, auditing and human resource which, if not addressed, may undermine their role as financial intermediaries to provide financial services to the rural population.
The relevant authorities must, therefore, take this issue seriously and up their sensitisation campaign about the programme in order to bring more people on board.
Long term strategies must be crafted in order to encourage Umurenge SACCOs to apply microfinance best practices.
Ultimately this will create sustainable SACCOs with diversified savings and loans products and able to protect members’ deposits.
This will not only help rural Rwandans to access money for investing in income generating activities but would also boost the country’s MDGs ambitions.