Musenero, start-ups call for establishment of innovation bank
What you need to know:
- Whereas Uganda has several financial institutions, it lacks those that specifically understand the work and needs of innovators, a fact that makes it very hard for innovators to get the much-needed financial support
Science, Technology and Innovation Minister Monica Musenero has said that unless the present financial institutions ‘shape up’ and meet the special needs of innovators, the idea to establish an Innovations Bank will not be farfetched.
While responding to access to financial support challenges raised by different start-ups at the National E-Mobility Policy Dialogue, Dr Musenero said that whereas the country has several financial institutions, it lacks those that specifically understand the work and needs of innovators
This, she said, makes it hard for innovators to get the much-needed financial support, noting that most times when innovators pitch digital or technology innovations for financing, banks say they do not fully understand such projects, their scalability, profitability, and risks involved.
“A time has reached where we need a bank dedicated to innovators. A bank that has people who understand innovations, how they work, the kind of incentives they need, and what is required for them to succeed. Such a bank would help us fill the funding gaps that many of our start-ups face. I strongly believe that the Innovation space has a huge customer base that would use the services of such a bank,” Dr Musenero said.
Speaker after speaker had earlier highlighted their inability to secure funding and access to patient capital locally, which suffocates the innovation industry.
Mr Geoffrey Mutabazi, the co-founder and chief executive officer of Karaa Africa, a startup that designs and deploys electric bicycles for last-mile transportation in Africa, said that while demand for electric bikes and cars is growing, their ability to serve the market is slowed down by funding gaps.
“Getting financial support for our innovations is very hard here. The commercial banks and other investors with the funds are still rigid and don’t fully appreciate how this space works. Raising funds for our innovations is much easier abroad than here at home because the people out there have a better appreciation of what we are doing,” he said.
Mr Nicholas Ntulume Luyimbula, a digital specialist, noted that even as government continues to inject more resources into the Uganda Development Bank (UDB), this too will not significantly benefit innovators because they are not in UDB’s priority sectors.
“It doesn’t address the financial gaps faced by digital and technology players because UDB’s supported sectors are service, infrastructure, industry, and agriculture. Thus, it cannot support very many innovators. As such, affirmative action should be channeled towards an Innovations’ Bank as a special purpose vehicle of sorts for catapulting the innovation industry,” he said.
The National E-Mobility Policy Dialogue was part of the broader National Science Week organized by the Ministry of Science, Technology, and Innovation to showcase different innovations that are shaping Uganda’s future in Education, Finance, Health, Trade, Transport, and Agriculture.
Maria Sandra Luwedde, a Barista with Nonda Coffee, one of the exhibitors at the Science Week noted that the big turn-up of both innovators and the general public at this weeklong event is a vote of confidence to innovators which they must use a springboard to conquer local and global markets through prioritizing market research, quality production and standards’ conformity.
