Masaka Union Co-operative Financial Services Limited (MUCOFI)

The Masaka Union Co-operative Financial Services Limited (MUCOFI) SACCO is the financial arm and sister company of the Masaka Cooperative Union (MCU). It was established to provide affordable and accessible financial services specifically for the farmers and members affiliated with the MCU in the Greater Masaka region.

 Core Services and Products

MUCOFI focuses on the two main functions of a SACCO: Savings and Credit.

1. Credit (Loan) Products

MUCOFI’s loan products are designed to align with the agricultural cycle. A key benefit is the affordable interest rates compared to private lenders.

• Agricultural Loans: These are the core offering, designed to support the entire agricultural value chain, including:
  • Purchasing farm inputs (seedlings, fertilizers, pesticides).
  • Farm maintenance and labor costs.
  • Financing harvesting and post-harvest handling.
• Working Capital/Business Loans: Provided to members who run small businesses, many of which complement their farming activities.
• “Coffee Loans”: Specifically designed to offer farmers cash advances secured against their expected coffee harvest at a low interest rate (reportedly as low as  1.5% per month), preventing them from selling their coffee to private buyers at unfavorable prices.

2. Savings Products

These products allow members to accumulate capital and participate in the ownership of the SACCO.

• Normal Savings Accounts: Secure facilities for members to save their income.
• Share Capital: Members purchase shares, which gives them part-ownership of the SACCO and entitles them to dividends when the SACCO is profitable. This helps build the institution’s capital base.

 Impact and Accountability

The establishment of MUCOFI has generated positive feedback from the community:

• Affordability: By offering low-interest rates, MUCOFI reduces the financial burden on farmers and improves their profit margins.
• Trust: Operating with transparency and accountability has been crucial in rebuilding trust among farmers who experienced the painful collapse of the Union decades ago.
• Empowerment: The SACCO plays a direct role in the economic empowerment of youth and women by providing them with access to training and credit to participate in the agricultural value chain.

Would you like to know the current membership size or the loan portfolio of MUCOFI?