The National Cooperative Credit Union Association (NaCCUA)-Sierra Leone, the Department of Cooperatives in the Ministry of Trade and Industry and the Bank of Sierra Leone on Friday 21st June 2024 signed two Memorandums of Understandings (MoUs) to regulate the effective operations of Credit Unions (CUs) in the country.
The signing ceremony took place at the Bank of Serra Leone conference room on Gloucester Street in Freetown.
The General Manager of the Irish League of Credit Union Foundation Limited (ILCUF), Mr. Solomon Mwongyere described the occasion of the signing as great for CUs in Sierra Leone, that ILCUF was working with 25 CUs in Sierra Leone with Le19 million new Leones as savings and Le24 million in total assets and stressed that the MoUs would help in building their finances as it is impossible for credit unions to grow without sound supervisions.
He furthered that their current project ends in October this year but that another five-year project had been approved by the government of Ireland through Irish Aid to commence in November to among others focus on growth of credit unions by establishing new ones including work-based like the Republic of Sierra Leone Armed Forces. The MoUs would effectively regulate CUs leaders to be accountable for the monies entrusted into their care by their members.
The Governor of the Bank of Sierra Leone, Dr. Ibrahim Stevens noted that the Bank is always ready to support efforts towards financial stability and for a stable economy enlightening that the MoUs would define the level of cooperation going forward, that legislations might come on for financial mobilization reiterating that the MoUs would help optimize the environment to prevent risks.
He added that the Bank is thinking of establishing a CU for its staff, collaborating with NaCCUA and other stakeholders, and added that the MoUs were the start of a long process of building a regulatory environment for CUs. Bank Governor Stevens emphasized that the Bank of Sierra Leone was looking forward to further collaboration.
According to Dr. Ibrahim Stevens, they were also thinking of resuscitating the defunct Cooperative Bank affirming that they want a coherent approach for optimal outcome.
The Deputy Governor of the Bank of Sierra Leone, who is in Charge of Financial Stability, Mr. Sheik Sesay revealed that they had been part of the journey and had come a long way. He also underscored that CUs are very important, and are becoming more interesting in the country.
He continued that the Bank of Sierra Leone and the Department of Cooperatives supervise CUs, adding that depending on their developments the Bank would always come in.
Mr. Newton Marlin, Registrar of Cooperatives, Department of Cooperatives asserted that he is very hopeful that the MoUs would be a great venture for Sierra Leone, disclosed that there are other Cooperatives in the Country, like ; mining, fishing and agriculture. He also highlighted that CUs are the fastest growing in the country, underlined that the MoUs would lead to a coherent policy for effective supervision and also serve as a stepping stone to advocate for financial inclusion.
According to Mr. Newton Marlin, unlike in the past, they want the Cooperative Bank to be resuscitated to be 80% owned by shareholders and 20% by government that is the correct foundation for the sustainable growth of CUs and their effective supervision which is a key milestone for their development.
The Chairperson board of NaCCUA, Mr. Lamin Kamara, asserted that they are the greatest beneficiaries of the MoUs and reaffirmed their commitment to abide by them. He further expressed gratitude for the trust which had been placed on the Association.
The signing of the MoUs marks a significant milestone in the development of the cooperative sector in Sierra Leone. It is expected to improve the financial health and sustainability of credit unions, providing members with access to affordable credit and other financial services. NaCCUA hold this gratuitous event to its partners ILCUF and Madam Esther Johnson and her staff at Other Financial Institutions Supervision (OFIS) Department of BSL.
Under the MoU, NaCCUA-SL will be responsible for;
- Conducting regular onsite and offsite inspections and supervision
- Enforcing compliance with regulations
- Ensuring the sound financial management of credit unions
- Providing reports about the credit union performance to credit union supervisory board
- Implementing inspections and remedial interventions as needed
- Advising the credit union supervisory board on anomalies, shortcomings or risks.
Highlight of the ceremony was the signing of the MoUs by the various stakeholders.