The Uganda Investment Authority and the Bank of Uganda on March 15 took their awareness workshop on affordable financing for small businesses and commercial farmers to the southwestern district of Rukungiri.
The workshop focused on the central bank’s two financing facilities: the Small Business Recovery Fund (SBRF) which targets micro, small and medium enterprises’ recovery from the adverse effects of the Covid pandemic, and the Agricultural Credit Facility (ACF) that targets commercial farmers.
The Governor of Bank of Uganda, Dr. Michael Atingi-Ego, in a speech read for him by the Executive Director Finance, Richard Byarugaba, said although small businesses are key to Uganda’s economic growth, their major constraint is access to affordable credit, hence the creation of the two funds – SBRF and ACF.
The Governor said the Agricultural Credit Facility, totaling 800 billion shillings, is for MSMEs to acquire things equipment for farming, post-harvest handling & value addition, amongst others.
The fund is accessed through Bank of Uganda-supervised financial institutions up to the tune of 2.1 billion shillings repayable in eight years (maximum), with a grace period of three years (maximum) and an interest rate of 12 percent per annum.
The SBRF, worth 200 billion shillings, provides affordable financial loans to small enterprises that have experienced hardships due to the measures undertaken to control the spread of the coronavirus in Uganda.
Eligibility is for small businesses operated by individuals, groups, partnerships, and companies, employing between 2-49 people and with an annual turnover of 10 to 300 million shillings, with demonstrable capacity for recovery.
Security Minister, Major General (retired) Jim Muhwezi, who presided over the workshop, hailed Uganda Investment Authority and Bank of Uganda for taking awareness on affordable funding to the people of Rukungiri whom he urged to access the money, invest wisely and boost their businesses.
The Chairman of Uganda Investment Authority, Morrison Rwakakamba, said the workshop on access to affordable financing is an eye opener to the business community and farmers in Uganda on funding opportunities offered by the government.
“Rukungiri is strategically located near eastern Democratic Republic of Congo and has enabling infrastructure like roads and electricity. These are opportunities and enablers that the business and farming communities should seize and exploit for investment and business”, said Rwakakamba.
The Rukungiri District Chairman, Geoffrey Kyomukama, urged the people to use the funds to boost commercial farming by investing in things like irrigation schemes, post-harvest handling, cold storage facilities, and transportation of produce, amongst others.
“My people let’s move with new development strategies. Time is now when you should arise with your group and family to share in national wealth. Take advantage of available investment opportunities”, said Kyomukama.
Representatives of banks like Stanbic, Centenary, Post, Equity and Pride Microfinance fielded questions from the participants on various financing issues.
The access to affordable financing workshops, already also held in Arua and Mbarara, are being rolled out to other parts of Uganda in an attempt to increase uptake of the central bank-managed funds.
According to Bank of Uganda records, of the 800 billion shillings under Agricultural Credit Facility, so far only 3,744 beneficiaries have accessed the funds, hence the need for more awareness creation on access to the funds.
