By Mulengera Reporters
Uganda’s Tier IV financial sector has taken a major step towards speaking with one voice following the launch of a new umbrella association bringing together SACCOs, village savings and loan associations, non-deposit-taking microfinance institutions and money lenders.
The new Association of Tier IV Financial Institutions of Uganda was launched during the Strategic Capacity Building Conference organised by the Private Sector Foundation Uganda (PSFU) under the GROW Project at Motiv Creation Centre in Bugolobi.
The two-day conference, held under the theme “Built to Last: Governance, Leadership and Transformation for Sustainable Tier IV Institutions,” brought together government officials, regulators, financial-sector players, development partners and leaders of Tier IV institutions to discuss how to strengthen the sector and expand financial inclusion.
The association inspired by the Generating Growth Opportunities for Women Enterprises (GROW) Project led by Dr. Ruth Aisha Kasolo in PSFU, replaces the former association of non-deposit-taking microfinance institutions, widening its membership to cover the entire Tier IV segment.
Edith Tusuubira, Commissioner in the Microfinance Regulatory Department at the Ministry of Finance, Planning and Economic Development, said the rebranding reflects the need for the different players within Tier IV to work together under a common platform.
“Today we are here to launch the Association of Tier 4 Institutions in the country. They are rebranding from the NDT Association of Microfinance to the association that recognises all Tier 4 institutions,” Tusuubira said.
She said the sector currently comprises more than 1,000 institutions under the supervision of the Microfinance Regulatory Department and manages more than Shs6 trillion, serving between 10 million and 11 million Ugandans.
Tusuubira urged the GROW Project and other development partners to continue directing resources towards the sector, arguing that investment in Tier IV institutions can have a significant impact because of their reach among communities that remain underserved by conventional financial institutions.
“If we can put money in this sector through the GROW Project, we shall have a greater impact in Uganda,” she said.
She particularly called for continued support for women and small businesses through the GROW Project, which is designed to expand access to finance and business opportunities for women entrepreneurs.
The new association is expected to provide a common platform through which Tier IV institutions can engage government, regulators, financiers and development partners on challenges affecting the sector.
Raymond Peter Kiwanuka, Chairman of the Association of Tier IV Financial Institutions of Uganda, said bringing the different institutions under one umbrella would strengthen their collective voice while also encouraging better standards across the sector.
“Previously we were only non-deposit taking institutions in this association, but today we have launched a new chapter where we are including all the SACCOs, Village Savings and Loans Associations, NDTs and moneylenders,” Kiwanuka said.
He said membership would remain voluntary but would be open to institutions holding a Tier IV licence.
“If we have one voice, we are going to be able to engage government, engage partners, engage financiers, to at least try and have our voice out there,” he said.
Kiwanuka said the association would also focus on improving governance within member institutions, warning that weak leadership and ineffective boards could undermine the sustainability of financial institutions.
His message to Tier IV institutions was direct: those without boards should establish them, while institutions with inactive boards should ensure they become fully functional.
“No institution can survive without having proper corporate governance,” Kiwanuka said.
He said boards must provide effective policy direction, ensure proper risk management and hold management accountable, while institutions must also work to keep the cost of financial services affordable for customers at the last mile.
The call for stronger institutions was echoed by Minister of State for Microfinance Shartsi Musherure, who said Tier IV institutions are central to Uganda’s financial inclusion agenda because they reach farmers, market vendors and small entrepreneurs who may struggle to access conventional bank financing.
“Where commercial banks may not reach, you do,” Musherure told sector leaders.
She said government had established a regulatory framework under the Tier 4 Microfinance Institutions and Money Lenders Act to protect customers, strengthen governance and build trust within the sector.
Musherure challenged boards and managers to improve governance, strengthen risk management, adopt digital systems and invest in the professional development of their staff.
She also called for stronger collaboration between government and the sector in areas such as capacity building, access to affordable wholesale funding, proportionate regulation and data sharing.
“Financial inclusion is not merely about access to services. It’s about access to sustainable services,” she said.
The minister said the government would continue working with Tier IV institutions as part of its broader financial inclusion and economic transformation agenda, while encouraging the sector to embrace innovation and adapt to changing consumer needs and emerging risks.
The conference also provided a platform for regulators and industry leaders to push for greater professionalisation of Tier IV institutions, with governance emerging as a key priority for the newly consolidated association.
For Kiwanuka, the ultimate test will be whether stronger institutions translate into better services for millions of Ugandans who depend on Tier IV providers for savings, credit and other financial services.
The association now intends to use its broader membership to advocate for the sector while working with regulators, government and development partners to build institutions that can sustainably serve Uganda’s financial needs at the last mile. (For comments on this story, get back to us on 0705579994 [WhatsApp line], 0779411734 & 041 4674611 or email us at mulengeranews@gmail.com).
