Toli mwaavu; mutwe gwo – #Uganda Business Ideas Part 5
What is stopping you series? Part 5.
Mbu Tusaba Government Etuyambe!
To go for a loan or save and start small. Many elites are torn between getting a loan to start business or save the little income to start small. I must say this is most difficult topic based on the number of temptations around this country from Banks, money Lenders, Saccos or office money lenders.
However, before you get a loan, first critically analyse the following. Do I have experience in what I am going invest in? What is the interest rate in clear terms basing on returns/ profits? In case of failure to pay, what are the repercussions for failure to pay.
Many working-class people upon getting a confirmation letter run to banks with that letter for salary loan. Agreement is signed and money given.
Did you know that these fellows at times use part of that loaned money to clear off some debts, have fun with friends and the balance is invested in businesses where profits may not come as predicted since in the first place, feasibility study was not done?
The fellow get a loan and half of his salary is cut by half or at times without any balance at the end of month as his salary, he runs to money lenders to bail him out on what will take him throughout the month.
With Pressure mounting from Bank, money lenders the fellow starts to hide from these people, back at work his performance is affected due to financial stress and before you know it he is FIRED due to poor performance.
Many corporates you see in bars every Thursday are looking for quick loans to take them through the weekend not to invest but to have fun with the boys, by the time this fellow’s 5-year contract ends, this brother or sister has nothing to show yet he has been working, driving a company branded cars but with 0.00 a count balance.
Generally, before you get a loan think twice, most tycoons in Kampala are dying due to high blood pressure caused by these bank loans. No wonder despite us being told that they are billionaires, these fellows can’t pay back the borrowed money.
Therefore, if you can please save part of your salary as an investment capital, you will not be trouble in case the business fails or delays to make a profit.
Many people will disagree with me but for Muslims they can agree with me on this issue because it involves ribah(interest) which is totally not allowed in Islam.
Finally, my friends before you get a loan, please look at the above narrative to have a wise investment decision.