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Cooperatives Unifying Market Women to Combat the Effects of COVID-19

“Through the group lending and borrowing model of the cooperative, I was able to borrow money which has supported my business to grow after COVID-19,”

Nancy Aloyo, the Vice Chairperson of Gulu Main Market Saving and Credit Cooperative Group.
PHOTO: Nancy Aloyo shows off the stock she has been able to purchase on her stall after acquiring a loan from the cooperative.

Nancy and 50 other market women in the cooperative share their stories of pain, triumph and success from the cooperative. The Cooperative started in 2018 as a CBO but has over the years grown into a cooperative with an agenda to support the group members economically, socially, emotionally and in all other spheres of life.

Elected in 2019, the leadership of the cooperative has been the pillar for its growth. It is made up of 9 women leaders who have been in charge of the growth and development of the cooperative. Through the strong leadership, the group members have managed to keep collecting up to 2,000,000 shillings monthly in group savings.

However, the cooperative has not only saved but also created a social fund for the group members where each member contributes 2,000 shillings weekly for any other social issues like parties, bereavement support, and health fund for its members.

Josephine Abwono confessed to have been a beneficiary of the fund saying, “When the lockdown was lifted, I returned to the market but my health was not good as I was in and out of the hospital. This affected my business but our cooperative gave me 200,000 shillings for medical bills which is interest free.”

The cooperative has also benefited from a Revolving Fund given by the Institute for Social Transformation (IST) with support from UN Women and Korea Hope Foundation. This is a fund that was given to the group to help them in revamping their businesses as well as for the group to achieve their goals and objectives at an affordable interest rate. Whereas the Revolving Fund is given at a very low interest rate, the group gives out loans to its members at only 3% which is lower than any commercial bank or money lending institution.

Jennifer Makeba, the treasurer alluded that the goal of the cooperative is to see their members succeeding in business and other spheres of life that is why they opted for a low interest rate. She said, “When you go to the bank, they will ask you for so many things in order to give you a loan. Besides having high rates of up to 15%, the bank requires you to have proper documentation and collateral. In fact, sometimes, the bank asks for evidence of spousal consent.” According to Jennifer, this hinders the ability of women to secure loans for their business there by making hindering their progress.

Nancy Aloyo is one of the members who acquired a loan from the cooperative and this is her story, “When we received the fund, I applied for a loan because my stall was almost empty and dry without produce. I sell Irish potatoes, onions, rice and beans. I was able to purchase sacks of rice, Irish and onions yet I was previously buying in basins. When you purchase in bulk, you get a higher profit margin compared to when you buy in small quantities. I have been able to grow and expand my business but I am also able to support my family and pay school fees for my son who is in Senior 3.”

Although Nancy has achieved immense success from securing the loan, she said that there are members who borrow money for business purposes but end up using it for other expenses like school fees and clearing debts from other groups. She explained that several women are carrying a heavy financial burden and the survival of their families is on their shoulders. Nancy therefore called upon IST to conduct more financial literacy trainings and financial management at individual levels to help the group members who have failed to balance their finances.

PHOTO: Some of the leaders of Gulu Main Market Saving and Credit Cooperative Group reviewing the financial situation of the cooperative during an ad hoc meeting in the market

Tasked to explain what happens to the group loan defaulters, Makeba the treasurer said that the reason why the cooperative is based in the market is because the members know themselves and have been working with each other for a long time so they are patient with one another, “Helping each other to grow as a group is our aim. We understand that some people may not always clear their loans on time. There is a small fine which is charged for all the defaulters but nothing extreme.”

The leadership of the cooperative recognises the fact that they are saving tirelessly but need more help in terms of money and any other resources. The leaders said that they applied for the Uganda Women Entrepreneurship Programme but have been on the waiting list for 2 years now and have not received feedback from the district although they met all the requirements.

With a strong leadership, the hope of the cooperative lies in implementing group projects. Betty Atoo one of the leaders said that their cooperative is planning to venture into outside catering, growing and selling of cereals where they will conduct joint marketing and make money to improve their livelihood. They also aspire to transfer the skills they have to other women in the markets while encouraging them to join the cooperative.