A total of 1,500 small and medium enterprises (SMEs) are set to benefit from a $15 million (around shs 68 billion) fund provided by the East African Development Bank (EADB).
This financial support will be channeled through three local banks: Centenary Bank, Housing Finance, and Opportunity Bank.
These banks will also roll out capacity-building programs aimed at enhancing the financial literacy of SME owners, equipping them to make better decisions and manage their operations more effectively.
The initiative aims to facilitate financial assistance among others across the agricultural value chain, to promote investment, boost rural incomes, and contribute to poverty reduction and food security.
At the signing ceremony of the Memorandum of Understanding, Ramadhan Ggoobi, the permanent secretary in the Ministry of Finance, described the funding as a significant achievement, noting that it would provide affordable credit to over 1,500 SMEs, marking a substantial advancement for the sector.
He called for continued government and partner support to ensure SMEs have access to affordable capital for growth.
Vivienne Yeda, the Director General of EADB, emphasized the significant impact of SMEs on Uganda’s economy, pointing out that they account for 70% of the GDP and generate almost 90% of employment opportunities.
She mentioned that EADB is working closely with local banks to provide technical assistance aimed at fostering innovation among SMEs.
Peace K. Ayebazibwe, the Executive Director and Chief Business Officer of Housing Finance Uganda, stated that resources are accessible to all Ugandans.
“As an indigenous Bank with a reputable track record in housing finance, we believe the MoU will also advance the agenda of other sectors that contribute to the growth and development of our communities and our country as a whole,” she added.
Through her official X account formerly twitter, she acknowledged that SMEs play a vital role in employment and the overall GDP of our country, contributing about 80% of total employment and, on average, 50% of GDP in most African countries.
“It is therefore our responsibility to support them for the betterment of Uganda,” he added.
Over the past 11 years, EADB has channeled USD 61 billion in affordable credit to SMEs across Uganda, Kenya, Tanzania, and Rwanda while also financing projects promoting environmental conservation and renewable energy.
