Uganda’s cooperatives revive plan to start own bank

Uganda’s cooperative movement is taking decisive steps to reclaim financial autonomy by reviving efforts to establish its own bank, in a bid to break away from what it calls an exploitative and profit-driven commercial banking sector.

During a national symposium of cooperatives held Friday in Fort Portal ahead of the 103rd International Day of Cooperatives, leaders from Savings and Credit Cooperative Organizations (SACCOs) and unions—under their umbrella body, the Uganda Cooperative Alliance (UCA)—united behind the plan to operationalize the long-delayed Uganda Cooperative Bank.

Their argument: commercial banks are failing to serve the unique needs of cooperatives, offering credit at high interest rates, imposing red tape, and ignoring the community-oriented principles at the heart of cooperative enterprise.

“We’ve had enough of relying on banks that don’t understand us,” declared Mr. Ivan Asiimwe, General Secretary of the Uganda Cooperative Alliance. “There is already cabinet approval. Cooperatives across the country have agreed—it’s time to build our own financial institution.”

Asiimwe said the new bank would offer affordable loans through SACCOs and unions, protect farmers from predatory middlemen, and keep cooperative funds circulating within the sector. “With our bank, coffee farmers won’t be forced to sell their gardens at a loss because of lack of access to credit,” he said.

The proposed bank will also give cooperators equity—something commercial banks do not offer. “Members will own shares and earn dividends,” Asiimwe added. “This is not just a bank for cooperatives—it’s a bank by cooperatives.”

Beyond serving its members, the UCA wants government to channel key development funds—such as PDM, Emyooga, Youth Livelihood Programme (YLP), and GROW—through the cooperative bank. They argue that current disbursement through commercial banks is riddled with inefficiencies, mistrust, and allegations of inaccessibility.

“People are told the money is finished, or they’re afraid of the process,” Asiimwe noted. “With our bank, the funds will go directly to the people through their cooperatives.”

The movement’s ambition doesn’t end with a bank. Cooperators are also calling for the creation of a national university specializing in cooperative education—offering degrees up to Ph.D. level—to address a skills gap within SACCO leadership and governance.

“Uganda only offers certificates and diplomas in cooperative studies. We want to stop sending people to Kenya and Tanzania for cooperative degrees,” Asiimwe said. “We must build our own capacity.”

Ms. Mercy Kusemererwa, General Manager of Busaiga SACCO, stressed that the current financial model does not serve the cooperative sector. “Commercial banks prioritize profits over people,” she said. “We need a financial institution where cooperators have ownership, control, and voice.”

Kusemererwa argued that a cooperative bank would empower SACCOs to lend affordably, retain capital within the sector, and align operations with cooperative values. “When you bank with a commercial institution, your money leaves the cooperative system. That must change.”

However, commercial banks have pushed back. Mr. James Junguru, Head of SACCOs at Stanbic Bank, acknowledged the critical role of SACCOs but defended the banks’ involvement in disbursing government funds. “We do not mishandle PDM or YLP funds,” he said. “In many cases, people don’t qualify, and that’s the issue—not the banks.”

Junguru added that commercial banks are already working to empower SACCOs by offering wholesale loans and capacity-building support.

Still, the mood among cooperators is one of urgency and resolve. The Fort Portal symposium underscored a wider shift: Uganda’s cooperative sector is no longer content being a client of the formal banking system—it now seeks to become a player in its own right.