KAMPALA-
Uganda Development Bank (UDB) has said the Shs1 trillion
recapitalisation will mainly focus on businesses involved in primary
agriculture, agro-industry and manufacturing.
Speaking in an interview, Mr Felix Okoboi, the UDB chairman, said the recapitalisation comes at a time when businesses need support to revitalise operations slowed down by Covid-19.
Speaking in an interview, Mr Felix Okoboi, the UDB chairman, said the recapitalisation comes at a time when businesses need support to revitalise operations slowed down by Covid-19.
“2020 has been challenging
[but] this money will help us [revitalise] businesses involved in
primary agriculture, agro-industry and manufacturing,” he said.
However,
Enterprise Uganda Executive Director Charles Ocici cautioned UDB to pay
serious attention and scrutinise small and medium enterprises that will
seek to tap into the Shs1 trillion kitty. Scrutinising prospective
borrowers and educating them about the pre-conditions of accessing the
money, he said, will be key in the recovery process for onward lending.
“Successful
financing in the commercial sector of banking must ensure that
resources circulate. If they go one way and they don’t come back, you
have eroded the ability of the bank,” he said, noting that the money
must only be lent out to entrepreneurs who have demonstrated capacity
and ability to fully utilise it.
In his 2020/21 budget
speech, Finance Minister Matia Kasaija allocated Shs1 trillion to UDB
to enable SMEs affected by Covid-19 to access low cost credit.
Mr
Ocici also urged National Agricultural Advisory Services and Operation
Wealth Creation to use the Shs300b allocation in redemption of
agribusiness.
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