The Uganda Investment Authority (UIA) and the Bank of Uganda have urged small businesses and commercial farmers to embrace affordable financing. This call was made during a workshop for SMEs in Rukungiri.
The workshop centered on two financing facilities offered by the central bank: the Small Business Recovery Fund (SBRF), aimed at assisting micro, small, and medium enterprises in recovering from the adverse impacts of the Covid pandemic, and the Agricultural Credit Facility (ACF), targeting commercial farmers.
Dr. Michael Atingi-Ego, the deputy governor of the Bank of Uganda, emphasized in a speech delivered by Richard Byarugaba, the Executive Director of Finance, that access to affordable credit is a major constraint for small businesses, hence the establishment of the SBRF and ACF.
The Agricultural Credit Facility, totaling Shs 800 billion, is intended for MSMEs to acquire farming equipment, engage in post-harvest handling, and invest in value addition, among other activities. Accessible through Bank of Uganda-supervised financial institutions, the fund offers loans of up to Shs 2.1 billion repayable over a maximum period of eight years, with a grace period of up to three years and an interest rate of 12 percent per annum.
The SBRF, valued at Shs 200 billion, provides affordable financial assistance to small enterprises that have faced challenges due to Covid-related measures in Uganda. Eligible recipients include small businesses operated by individuals, groups, partnerships, and companies, employing between 2-49 people with an annual turnover of Shs 10 million to Shs 300 million, demonstrating the capacity for recovery.
Jim Muhwezi, the Minister of Security, commended UIA and the Bank of Uganda for raising awareness about accessible funding opportunities in Rukungiri. He urged the locals to utilize the funds wisely to enhance their businesses.
Morrison Rwakakamba, Chairman of Uganda Investment Authority, described the workshop as enlightening for the business and farming communities in Uganda, emphasizing the strategic location and enabling infrastructure of Rukungiri.
Geoffrey Kyomukama, the Chairman of Rukungiri district, encouraged people to invest in commercial farming using the funds, focusing on areas like irrigation schemes, post-harvest handling, cold storage facilities, and transportation of produce.
Representatives from banks such as Stanbic, Centenary, Post, Equity, and Pride Microfinance addressed participants’ queries on various financing matters.
These workshops on access to affordable financing, already conducted in Arua and Mbarara, are being extended to other parts of Uganda to enhance the uptake of centrally managed funds by the central bank.
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