By Namugerwa Martha
In this current Economic recession in Uganda, many businesses have called it a quit; some have sent many of their employees’ home packing in order to suit the playing field.
Still on the same point, that brings me to a query whether Micro Finance Institutions will still stay in business despite losing clients day by day due to the rapid growth of other cash rendering services like Mobile Money.
Micro Finance institutions like Finca Uganda Limited have been declining in their profits since people no longer depositing or taking loans from the institutions.
James Onyutta, chief executive officer Finca Uganda Limited says that he is afraid that in time there will be no micro finance institutions due to a lot of losses that are being incurred lately in this financial sector.
“The people’s rate of borrowing or depositing money is very low and this is exerting a lot of pressure to Micro Finance Banks yet other money sectors like mobile money services are gaining a lot of profits lately,” Onyutta said.
People are more engaged in mobile money services because it is easy to access and also demand fewer profits unlike banks.
Meanwhile being a client on mobile money service, by saving with it a person can easily access a loan without being asked for many papers.