New plan for farmers to repay loans after harvest

The new initiative, which enables farmers to begin loan repayment with harvest cycles, will cover both crops and livestock. FILE PHOTO

Farmers who have got loans to invest in their businesses will have favourable terms of repayment, which are tied to the harvesting season cycles.
This was disclosed by Wilson Twamuhabwa, executive director, Ugafode microfinance, during a customer day held at Rwashamaire in Kajara, Ntungamo District.
He pointed out that most financial institutions find it difficult to undertake agricultural financing because of the risks involved and with no insurance.
But with good loan appraisal and attaching loans to the harvesting cycle, agricultural financing becomes like financing any other business.

Turyamuhabwa’s remarks followed concerns by farmers that they have always found difficult to service loans from financial institutions for not considering the nature of business they do.
“We have come out to help farmers do agriculture as a business, we will attach loans to the harvesting cycle both for animal husbandry and farming,” he said.
“If you apply a loan to buy cattle for beef, we will begin the repaying period when you begin slaughtering.”
He added that Ugafode has already secured a $1.5m (Shs5b) funding from US to support them in mitigating risks involved in this undertaking this initiative.