What you need to know:
- According to data contained in the Agricultural Credit Facility Progress report, financed projects rose by 58.4 percent from 257 to 407.
Loan applications through the Agricultural Credit Facility increased by 58.7 percent during the period ended June 30.
According to data contained in the Agricultural Credit Facility Progress report, financed projects rose by 58.4 percent from 257 to 407.
However, approvals were twice lower than the 411 applications valued at Shs90.06b that were received during the period.
Whereas the report indicates that loans through the Agricultural Credit Facility increased, lending to the agricultural sector by supervised financial institutions declined by 41.3 percent with disbursed loans falling from Shs2.26 trillion as of March 2020 to Shs1.32 trillion cumulatively in the 15 months ending June.
During the period, the Central Bank indicated, a total of Shs287.45b was committed between April 2020 and June 2021.
The increase, the Central Bank says, demonstrate demand for financing with a surge in demand for credit among micro, small and medium enterprises coming out prominently.
The report also noted that the Agricultural Credit Facility has since 2009 extended credit worth Shs620.04b to 1,220 beneficiaries, enhanced financial inclusion through block allocation where 314 micro small and medium enterprises have accessed funding without the traditional collateral requirements.
In October 2009, government launched the Agricultural Credit Facility with the aim of facilitating provision of medium and long term financing to projects engaged in agriculture and agro-processing.
This sought to achieve the long-term agenda of commercialisation and value addition in the agricultural sector.
Since 2009, the Agricultural Credit Facility has extended more than Shs158.2b to about 103 agro processors engaged in value addition, boosting export promotion of agro-processed Ugandan made products, especially in the dairy, tea and grain milling sectors.
In Uganda, agriculture, which employs 70 percent of the population lacks financing due to risks associated with the sector.