Bank of Uganda wants to come and regulate the Saccos and the registered lending companies. Wonderful.
However, I find this overstretching for the central bank. I have dealt with Letshego for 20 years. I started with Shs 20 million in 2004 with my logbook. Just a logbook and a dream. Today they have grown me to more than Shs 500 million.
You ask for a loan and in three days you have it. Three days. Not three months of papers, not three committees, not three suits asking you for your grandfather’s birth certificate. Letshego is down with the needs of the grassroots.
They have grown from a barracks of forcing to pay back to a solution to pay back. They give you a loan with fair terms, with two to three months of grace to utilize the loan and then pay back. That grace is life. That grace is wisdom.
That grace is what a real lender does when he understands business. You plant first, then you harvest. You do not harvest a seed the day you plant it. I have grown wings with these guys in my business because of that.
The taxes I have paid, the jobs I have created, the value addition to the local market is immense using Letshego facilities. That is not theory. That is my sweat. That is my shop. That is my workers feeding their families.
If I knew the owners of this group, I would tell them this is what we need as a nation for the SMEs. This is the model. Not the bank that hides behind air conditioning and suits. And now BOU wants to come and regulate the Saccos?
Seriously, it is like harvesting without sowing? Let us look at the world, because Uganda is not the first country to face this. In Kenya, Saccos are the backbone. Mwalimu Sacco, Stima Sacco, Harambee Sacco.
They lend to teachers, to workers, to boda riders, to mama mbogas. The Central Bank of Kenya did not kill them. It created a Sacco regulator that partners with them. Today, Kenyan Saccos hold billions of shillings and they fund houses, schools, matatus, farms.
The government milks tax from all that growth. That is the lesson BOU needs. BOU can benefit more from Saccos than from regulating them.
HOW? LISTEN CAREFULLY.
When a Sacco or Letshego gives a borrower money, that borrower does not eat the money. He invests it. He buys a boda. He stocks a shop. He buys maize to mill. He buys iron sheets to build rentals. He buys a fridge for cold drinks.
That investment becomes a product. That product becomes a sale. That sale becomes profit. That profit becomes a salary for a worker. That worker pays rent, buys food, pays school fees. The shop pays trading licence. The boda pays permit.
The business pays VAT. The worker pays PAYE. The bank gets deposits. The country gets forex because local products replace imports. That is the milk. That is the real milk.
Rhetorically, BOU wants to milk the cow by cutting its neck. A wise farmer milks the cow by feeding it. Give all the PDM money to Letshego and Saccos. I say it with my full chest. Give it to the people who know the grassroots.
Give it to the people who give loans in three days, not three months. Give it to the people who give grace, not pressure. BOU will milk more than regulation. BOU will milk taxes, BOU will milk jobs, BOU will milk stability, BOU will milk financial inclusion, BOU will milk a Uganda that actually works.
Regulation that kills lending is not regulation. Young man, old man, business woman, listen. Keep your ledger. Keep your Sacco. Keep your Letshego. Work hard. Push work. Work makes the wallet smile in the morning, afternoon, evening.
Do not expect to pick Gold, Diamond, Ivory at the road side. You can only pick them from heaven, and you know how to reach heaven. Through sweat. Through investment. Through a lender who understands you.
And BOU, if you are listening, come down from the textbook mountain. Come to the jungle. Come and learn from the people who have been feeding this nation while you were sleeping. Do not regulate the Saccos to death. Partner with them. Feed them. Protect them. And you will harvest more than you ever dreamed.
The author is an investor, contractor, and football enthusiast.