Government has urged farmers and small business owners to use its financing schemes to expand production and create jobs.
Sarah Nantongo, the head of credit appraisal at the Agricultural Credit Facility (ACF), said they finance projects across the agricultural value chain. She was speaking during the financial year 2027/28 Local Government Budget Consultative Workshops.
The facility offers loans of up to Shs5 billion at a fixed interest rate of not more than 12 per cent a year. Participating lenders may charge an arrangement fee of up to 0.5 per cent.
The government provides half of the money lent through commercial banks. Its contribution rises to 70 per cent for loans issued through credit institutions, regulated savings and credit cooperative organisations, and microfinance deposit-taking institutions. The government’s share attracts no interest.
Farmers must apply through participating financial institutions. The lenders assess applications, issue the money and collect repayments.
The scheme covers farm development, irrigation, livestock, agro-processing and post-harvest handling. It does not finance land purchases, tree planting, forestry projects or the repayment of existing loans.
Nantongo said the facility had received more than 23,000 applications worth over Shs2.1 trillion. It had approved and disbursed more than 15,000 loans worth about Shs1.5 trillion.
She also presented the Grain Trade Facility, which offers loans of up to Shs10 billion to businesses that buy and store surplus grain.
Borrowers can repay the loans within six months to two years. Interest cannot exceed 15 per cent a year.
The Small Business Fund supports viable enterprises outside agriculture. It grew out of the Covid-19 Small Business Recovery Fund.
Retail shops, schools, tailoring businesses, carpentry workshops and hardware stores can apply for the money.
The fund offers loans of up to Shs500 million, repayable within four years. It caps interest at 10 per cent a year on a reducing balance. Lenders may charge an arrangement fee of up to 0.5 per cent.
By June 30, 2026, the fund had received more than 4,000 applications worth Shs96.06 billion. It had disbursed nearly 4,000 loans worth Shs75.56 billion. The government contributed Shs37.78 billion to those loans.
The government asked local authorities to help businesses register, keep proper records and meet regulatory requirements. It also advised Saccos to seek Bank of Uganda regulation so they can access state-supported financing.
The facilities form part of the government’s plan to widen access to affordable credit, commercialise agriculture, strengthen enterprises and raise household incomes.
