Parliament Speaker Oboth Mediates SACCO Licensing Dispute

Speaker of Parliament Jacob Marksons Oboth has successfully mediated a resolution between the Bank of Uganda (BOU) and the Uganda Co-operative Savings and Credit Union Limited (UCSCU) concerning SACCO licensing.

The intervention came after UCSCU petitioned Parliament regarding a BOU directive that large SACCOs must apply for licenses by September 30, 2026. Failure to comply would have resulted in these institutions being disconnected from the commercial banking system and mobile money services.

During a meeting attended by BOU Governor Michael Atingi-Ego, cooperative leaders, and officials from the Ministry of Finance and Ministry of Trade, Speaker Oboth directed the Ministry of Finance to draft amendments to the law governing SACCOs. This move aims to harmonize the regulatory framework.

BOU Governor Atingi-Ego emphasized the urgency, citing the Microfinance Deposit-Taking Institutions Act and 2023 regulations, and warned of Uganda facing a grey listing by the Financial Action Task Force (FATF) if compliance deadlines were missed. He noted that while eight SACCOs were licensed and 21 were nearing completion, many others had not yet applied.

UCSCU CEO Sylvester Ndiroramukama clarified that SACCOs are not against regulation but seek a unified approach, as they are currently subject to multiple laws and regulatory bodies. He also explained that many SACCOs could not meet the initial deadline due to the timing of their Annual General Meetings, which are crucial for approving licensing applications.

To address these concerns, Speaker Oboth instructed large SACCOs to obtain licensing application forms within seven days. He also proposed a phased compliance approach, allowing SACCOs making genuine efforts to apply by March 31, 2027, with a final deadline of June 30, 2027.

A taskforce previously formed to develop counter-proposals to BOU’s stance will be reinstated to monitor the implementation of the agreed roadmap. BOU cautioned that any extension requires concrete action from the SACCOs, and its regulatory stance remains in effect.

Source: Parliament of Uganda