KAMPALA — EFC Uganda Limited (MDI) has sealed a financing deal worth UGX 8 billion with Oiko Credit Uganda.
These funds are planned to go towards the financing of SMEsin Uganda.
Oiko Credit is a worldwide cooperative and social investor that promotes sustainable development by providing loans and capital in low-income countries. It is one of the world’s largest sources of private funding to the microfinance sector with partnerships spanning across various continents, including Africa.
The SME sector is a primary driver in Uganda’s journey to full economic growth and independence. EFC Uganda is working towards becoming the leading SME financial institution by 2025. It is this vision that constantly propels us to find innovative solutions that support in addressing challenges facing SMEs in Uganda. Therefore,creating easy access to financing is fundamental in our Vision 2025,realization.
This financing deal is concluded at a critical timewhen SMEs are on a recovery trajectory from the effects of the Covid – 19 pandemic. We note that SMEs face several challenges with the most reportedbeinglimited access to financing.
In defining SMEs, our categorization is based on size (total assets) and number of people employed by the entity. The small enterprises employ between 5 and 49 and considered to have total assets between UGX 10 million andnot exceeding UGX 100 million. The medium enterprises therefore employ between 50 and 100 with total assets more than UGX 100 million but not exceeding UGX 360 million. Enterprises that meet these requirements will be able to benefit from this fund.
In the recent past, EFC Uganda has created different products to serve its SME base better. In April of 2022 EFC Uganda designed and rolled out a campaign dubbed “SIMBULA LOANS NE EFC”through whichinitiative loans close to UGX 13.5 BN were extendedto Ugandans.
EFC Uganda is also part of the Small Business Recovery Fund, a partnership with Bank of Uganda where entrepreneurs can access loans of up to UGX 100 million at very low interest rates notexceeding 10 %.