List Of Investment Clubs In Uganda
An investment club is a group of individuals who meet for the purpose of pooling money and investing; members typically meet on a periodic basis to make investment decisions as a group through a voting process and recording of minutes, or gather information and perform investment transactions outside the group.
Here are the List Of Investment Clubs In Uganda
In the past seven to ten years, Uganda has witnessed an explosion of investment clubs. Friends, family members, colleagues at work, former schoolmates and a host of individuals with a common bond have come together to save and invest, as a means of securing their financial future.
According to the Investment Club Association of Uganda, there are more than 8,000 investment clubs in Uganda. Investment clubs have sought to create wealth for members by investing in a variety of asset classes. Investment clubs typically invest in real estate, transportation and agriculture. Apart from helping in the cultivation of a savings culture among Ugandans and providing financial security for members, investment clubs can be an economic driver by providing long term capital for businesses, if soundly managed with the necessary investment know-how.
There is an old saying that cautions on the risk of putting all your eggs in one basket.
Applied to investment clubs, to minimise risk to their members’ savings, it is imperative that they invest widely in different types of assets. Investment clubs need to give consideration to the purchase of financial assets by investing in Collective Investment Schemes (CIS) which invest across different other financial assets, selected by a professional manager, rather than the investment clubs’ leadership (who are typically comprised of busy full time employees).
Diversification through such financial assets can contribute to growing members’ wealth in a regulated environment.
A CIS involves several investors contributing money into a common pool, with the funds collected being invested by a professional manager. In Uganda, there are five CIS managers (UAP-Old Mutual, Xeno, ICEA, Stanlib and Britam) who are licensed and closely regulated by the Capital Markets Authority (CMA). The regulation of CIS managers by CMA provides a layer of safety and protection for members’ contributions.
he law in Uganda recognizes the existence of investment clubs though it refers to them as self-help groups.
Under the Tier 4 Microfinance Institutions and Money Lenders Act 2016, these groups can be started for purposes of mobilizing and managing own savings, providing interest bearing loans to its members, offering a limited form of insurance to its members and sharing out member equity at least once a year in proportion to the savings.
Though the law requires these groups to be registered with the respective local governments, this rarely happens.
Registration is intended to facilitate supervision of these clubs hence mitigating the mismanagement and misappropriation of funds. Registration may also facilitate the transition of the group to a formal entity.
Although a step in the right direction, this registration by the clubs/groups does not confer legal personality.
How do I register for investment clubs in Uganda?
Requirements
- Opening cash deposit of Ugx.50,000
- Copy of Investment Club bye – laws and minutes with a resolution to open the account
- Copy of the Investment Club registration certificate
- Copy of valid Identity documents for Account signatories including the following:
Valid National Identity Card for Ugandans
Passport for foreigners (Non-Ugandans).
Refugee Identity Card for Refugees. - Two (2) recent Passport photos for the Account signatories
- Signatories mandate