By Our Reporter
The Uhuru Institute, through its Freedom Fund Enterprise has launched Piki-Credit, a product aimed at providing flexible credit facilities to Cooperatives. The loan is payable in approximately 16 months. With an initial deposit of Ushs 500,000, a member of the cooperative can own a motor cycle and start the journey to financial freedom. The beneficiary of Piki-Credit is the Kampala Civic Center Boda-boda Transporters Cooperative Society (KCCBT). Established in 2013, KCCBT is one of the most properly structured boda-boda Cooperatives. It has 79 members.
The objective of Piki-Credit is to ensure holistic empowerment of the boda-boda business community. Whereas the loan guarantees ownership of a motor bike, and therefore a source of livelihood, membership to a Cooperative Society comes with added advantages such as training in: road safety, book keeping, corporate governance, tax filing and personal financial literacy among others.
The biggest impediment to the existence of boda-bodas is the public perception that they are perpetrators of lawlessness and high risk of accidents in the city. Therefore, trainings from Cooperatives instill in the cyclists a sense of discipline and order thereby promoting responsible business. More so, Cooperatives provide leadership opportunities, earnings from dividends and bigger opportunities for business growth among other benefits.
Speaking to the leaders of KCCBT at a recent function, Leonard Okello, CEO of the Uhuru Institute said, “KCCBT cyclists should expand their business beyond merely providing commuter transport services. They should explore opportunities in courier services, produce marketing, mechanical services, real estate, to take their business to the next level.”
The boda-boda business in Kampala is lucrative. The influx of people in the city and the resultant heavy traffic has posed a challenge in transportation. People spend hours trapped in endless traffic, arriving late at their destinations. Motor cycles provide an efficient solution to the transport crisis because of their ability to navigate easily through traffic and access remote areas. Cyclists earn a decent living on average Ushs 60,000 per day. The sector employs about 1.6 million people, approximately 7% of Uganda’s population.
However, acquisition of the motor bikes is a challenge. Many cyclists lack the requisite collateral to acquire loans. Moreover, many of the loans attract high interest rates and come with stringent repayment policies that many cyclists cannot adhere to. The alternative is for the cyclists to rent motor cycles and pay Ushs 60,000 weekly to the owners. This option comes with restrictions and reduces the cyclist’s income. Piki-Credit therefore provides a viable solution to the improvement of boda-boda business.
Nyambura is a senior journalist based in Kampala