Ministry's system to support automation of Saccos services
Thursday August 19 2021
There are 416 Umurenge Saccos across the country serving over two million members who are largely low-income rural people with limited access to the formal banking services. PHOTO | CYRIL NDEGEYA
Automation of Savings and Credit Cooperatives (Saccos) services will take longer than expected as government pumps in Rwf 7.6 billion to complete the project.
The government has opted for inhouse developed systems to revive the automation project in which estimated Rwf2.7 billion was lost.
Details have emerged that automation of Saccos operations and merger into a co-operative bank to seal loopholes that have for long been blamed for fraud and embezzlement of members’ funds could take off next year after missing previous deadlines amid procurement hitches.
For instance, despite Rwanda Co-operative Agency (RCA) paying Rwf5.7 billion for consultants’ services and purchasing required IT equipment to automate the Saccos by 2018, the project could not materialize years later due to disagreement with the company hired to do the work.
Rwanda Today learnt, however, that a decision was made to undertake the project using internal system developers at the Ministry of Finance, in collaboration with the Rwanda Information Society (RISA), and other stakeholders.
According to RCA officials, this had seen services of 25 Saccos automated so far in a pilot phase.
“Data cleaning is ongoing for another 21 Saccos in Gicumbi and Rubavu. The plan is that at least by August 2022 automation of all Saccos can be completed.
The process was scheduled to take 12 months but it has not been easy due to pandemic containment measures,” RCA director-general Jean Bosco Harelimana, told Rwanda Today.
There are 416 Umurenge Saccos across the country serving over two million members who are largely low-income rural people with limited access to the formal banking services. The auditor general in his report released in May showed that the botched automation project not only continued to expose members to losses linked to the manual system and loopholes exploited by rogue managers, but also occasioned yet another loss of taxpayers’ money.
Details show that while the new project under the in-house arrangement will cost Rwf7.6 billion, the government had already spent Rwf2.3 billion on automation services, due diligence, data cleaning, payment of salaries and other tasks that are not useful for the new project, thereby implying a loss.
The audit estimates the total loss at Rwf2.7 billion including monies paid in a lawsuit won by Fintech International Ltd, the company contracted on the initial project.