Dr Peter Ngategize, a senior official at the ministry of Finance, has said investment clubs have potential to mobilise critical savings that might help fund important projects in the country.
Ngategize, who is also the patron of Investment Clubs Association in Uganda (ICAU), said recently that the country could not entirely rely on foreign capital to develop itself.
“Whatever money we are using is someone else’s savings,” said Ngategize, also the coordinator of competitiveness investment climate strategy at ministry of finance.
He was speaking last week at an event organised by ICAU to celebrate outstanding investment clubs in the country. Ngategize said Kenya has been a model in this area and “Ugandans needed to leverage on social capital and be able to live with integrity in our country.”
The association organised awards for the best investment clubs. This year, the winner was Amigos Investment club based in Ntinda. It was given Shs 1m as a prize.
According to Bank of Uganda financial inclusion strategy, 72 per cent Ugandans are currently saving but 60 per cent of them keep their money in secret places. Some forget where they put it; for others, it is stolen.
The most common reason for saving is to meet basic household needs and emergencies. Investment clubs act as avenues or collateral that can help their members’ access to affordable loans from banks.
At least 35 per cent Ugandans aged 16 and above have never borrowed while 33 per cent borrow from friends or family, according to BOU. Only seven per cent borrow from commercial banks.