26 September 2016

Uganda: Govt to Extend Interest-Free Loans to Women Groups

Kampala — More than 2,000 groups of women will acquire interest-free loans worth Shs43 billion from the government under the Uganda Women's Entrepreneurship programme (UWEP).

The Ministry of Gender permanent secretary, Mr Puis Bigirimana, said the move aims at lessening financial hurdles that limit women from kick-starting and expanding enterprises.

"Women entrepreneurs are constrained by limited access to finance as they attempt to grow their businesses. UWEP will promote women's economic empowerment through entrepreneurship skills," Mr Bigirimana said.

He was speaking during the orientation workshop for district leaders in Kampala last Thursday. The workshop attended by about 40 district officials was convened to shed light on the implementation of the programme.

Statistics from the Uganda National Household Survey show that the unemployment rate among women has increased from 2.2 per cent in 2005/2006 to 11 per cent in 2012/2013.

The 2016 UWEP programme document indicates that women account for 86.2 per cent of actors in the informal sector.

However, they are hugely excluded from accessing financial credit due to lack of collateral security, unequal access to resources such as land, limited information and education.

Under the programme, groups will receive up to Shs12.5 million each while special projects that benefit a bigger community will receive Shs25 million. Women are expected to allocate 70 per cent of the money to capital development and 15 per cent towards skills development.

UWEP National programme coordinator Ms Brenda Kifuko said all beneficiaries will have to pay back to enable more women access credit.

"The grace period given to groups for payback will depend on the maturity of an enterprise. This will be negotiable and groups will pay on a monthly basis," she explained.

On whether there will be any interest rate levied, Ms Kifuko said: "Groups that pay in the first year of reception will only pay the principle amount while groups that pay after the first year will be subject to a 5 per cent interest rate in form of a service fee to cater for inflation," she said.

State minister for Gender and Culture, Ms Peace Mutuuzo, appealed to women to organise themselves and apply for the money and warned district officials intending to jeopardise the programme.

The programme commenced in 2015/2016 in 19 districts but was rolled out countrywide at the start of financial year 2016/2017.

Some of the eligible groups include unemployed women, women with HIV/Aids and women living with disabilities, among others.

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