Uganda: Expensive loans affecting micro-finance
By Samuel Sanya, New Vision
The effects of the global financial crisis are starting to take a toll on micro-finance institutions through expensive credit and higher interest rates, insiders reveal.
Wilson Twamuhabwa, the chairperson of the Association of Microfinance Institutions of Uganda (AMFIU) pointed out that local microfinance associations are finding it increasingly harder to access credit from international lending organisations like Propaco.
“The challenges in Europe are starting to affect us locally. We believe that as the economy starts to stabilise, interest rates will also drop,” he said.
“We are working at forming a single umbrella body for all microfinance institutions. This will enable us negotiate for better terms from the Government and international finance partners.”
He made the comments at the Citi bank Micro-entreprenuership Awards Ceremony at the Sheraton Kampala Hotel recently.
Over 30 micro entrepreneursaround the country with businesses in poultry, confectionary, animal and crop husbandry, real estate and fish farming received accolades.
Top honours went to Allen Mansa, a beneficiary of financing from Rukiga Savings and Credit Organisation who earns over sh7m a month from an assortment of micro-projects from an initial investment of sh700,000 over six years ago.