Capital Markets Authority – Uganda witnesses investment growth in 2024

The Capital Markets Authority (CMA) recently awarded its stakeholders, appreciating their efforts towards the growth of the collective investment schemes (CIS) industry in Uganda, whose growth in assets and clients is unprecedented.

Dickson Ssembuya, the director of research and market development at CMA, said the industry has witnessed tremendous growth from Shs 127 billion in December 2018 to Shs 2.8 trillion as at the end of March 2024.

Talking about the factors that have favoured the milestone, he pointed to the Capital Markets Authority’s public education campaign, which raised awareness about the industry, and ultimately led to the growth in assets.

Ssembuya also explained that the midterm funds obtained by NSSF savers have favoured the growth of the industry as they are moved into collective investment schemes.

“When savers in NSSF accessed the midterm funds, much of those funds was actually moved into collective investment schemes. That also drove a spike in the assets under management.”

Ssembuya went ahead and said that the industry’s robust regulatory framework has given Ugandans confidence in collective investment schemes. The winners of the day included ICEA Lion Asset Management Limited, Old Mutual Investment Group, Xeno Investment Management Limited and Britam Asset Managers Company Limited, just to mention a few.

Aeko Ongodia, the founder and CEO of Xeno, highlighted a significant trend observed over the past fiscal year, noting that there has been an increase in utilizing collective investment schemes (CIS) for constructing portfolios tailored for retirement schemes.

Aeko pointed out that various entities, such as like Umeme Limited, Parliament, and Makerere University, are opting to utilize unit trust funds to manage their investment portfolios earmarked for their employees’ retirement benefits.

Owen Kato of ICEA Lion Asset Management, emphasized the importance of demystifying the perception that saving and investing in capital markets are only for the wealthy. He stressed the need to educate individuals and assure them that even small amounts such as Shs 100,000 can be invested in the capital markets, and accrue interest over time.