Umwalimu SACCO, a teachers’ cooperative union, seeks to embrace electronic banking this year to boost its financial services to its clients.
Vianney Nzagahimana, the sacco’s board chairman said that in partnership with other cooperatives through Rwanda Cooperative Agency (RCA), the cooperatives’ regulator, teachers will be able to access their accounts at any Savings Credit and Cooperative-SACCO countrywide.
“The new system will also incorporate a biometric component that will ensure client security whereby each teacher using the service will have their finger prints taken to form the system security ,” he told Business Times last week, adding that the project will help members located in areas not covered by its branches to access their accounts.
The Umwalimu Sacco has 60,000 members with 20 branches. Under the proposed partnership, RCA will provide Umwalimu Sacco branches with equipment such as computers, internet and scanners as facilitation and support to rollout the project. Nzagahimana added that the e-banking system will also help teachers who receive their salaries through the sacco to access this in real time at any sacco branch anywhere.
Currently 36,000 teachers countrywide receive their salaries through Umwalimu Sacco with the other 24,000 teachers, who are presently non-members utilising other financial institutions. However, according to Umwalimu Sacco, all teachers would receive their salaries through it.
“This year, all teachers will be paid through the cooperative and we expect this to raise our capacity as a financial institution,” Joseph Museruka, the managing director of Umwalimu SACCO said, adding that the cooperative offers overdrafts to clients at any date of the month.
Rita Ngarambe, the Executive Secretary of The Association of Microfinance Institutions (AMIR) lauded Umwalimu Sacco’s new move, saying that it would boost banking penetration in the country.
“This will go well along with the financial campaign we are spearheading to boost banking penetration countrywide through the cooperative system,” she said, noting that currently, over 300 teachers have been trained in financial education to help promote financial literacy and loan management in rural areas.
Museruka believes that his sacco’s financial recovery is as a result of decreased operational costs, as well as an increase in loan disbursement that moved to Rwf 50 million in 2010 up from Rwf 3 million in 2009 and diversification of its financial products.
“We received a Rwf 1.5 billion loan from Rwanda Development Bank for our mortgage product and we will give out mortgagee loans to teachers at only 14 percent,” Museruka said adding that the loan facility released under BRD’s mortgage financing for public servants and individuals will help Umwalimu Sacco to fund its housing programme for members.