Eco Bank signs Shs17 billion rural health credit scheme
Posted Thursday, January 30 2014 at 02:00
Solution. The scheme is meant to reduce the cost of private healthcare services in rural areas.
Eco Bank Uganda, the Swedish International Development Agency (SIDA) and the United States Mission in Uganda, have signed a Shs17 billion agreement to expand access to credit for private health centres in rural Uganda.
The credit targets private healthcare providers including pharmaceuticals, wholesalers, retail dispensaries, service delivery franchisers, private clinics and hospitals as well as service providers in their official capacity.
Speaking at the launch, Eco Bank managing director Michael Monari said the money belongs to Eco Bank but SIDA and United States Agency for International Development (USAID) have accepted to act as guarantors in case there are incidences of defaulting.
“This is our money. USAID and SIDA have accepted to be guarantors in case of defaulting. We shall assess the needs and give out the loans based on the needs. It could be asset financing, constructing new premises generally we shall have different facilities,” he told journalists in Kampala on Tuesday.
According to Dr Dithan Kiragga, the chief of party USAID private health support programme, there has been demand for healthcare development financing from private developers but they could not access the funding.
This, he said, was mainly because the banks considered it a very risky venture since the operators do not keep financial records and proper books of accounts.
Increased health care access
“The health sector is as important as agriculture in the economy and government cannot provide it alone but all these revolve around financial discipline. The health sector is not any different from any other sector but we would like to increase affordability, access and reduce the cost of private healthcare services in rural areas,” he said.
Asked how Eco Bank with a minimal branch network will be able to cover the entire country, Mr Monari said the bank is expanding its branch network all over the country but most of the initial transactions will be conducted at the head office.
“We are expanding to Gulu, Jinja, Arua, Mbararara and Mbale and we think these can serve the purpose in the meantime. For the initial transactions, we shall process them at our head office,” he said.
With headquarters in Ghana, Eco Bank is one of the foreign banks in Uganda with a presence in 33 countries.