By Lawrence Kooko
aBi Finance Limited and ASA Microfinance Uganda have launched a two-year project to extend green financing to farmers and agribusinesses in Northern and Eastern Uganda, with a separate Shs10 billion loan facility earmarked for lending.
The Sustainable Pathways for Rural Outreach and Upward Transition into Nature-positive Growth (SPROUT) project will invest more than Shs2 billion in the systems needed to widen access to finance, including new ASA branches, staff training, agricultural loan products and a digital financial services platform.
The Shs10 billion lending facility will target farmers and agribusinesses seeking to invest in irrigation, improved seed and other climate-smart technologies and practices.
At the launch in Kampala, aBi Finance Chief Executive Officer Mona Muguma Ssebuliba said agriculture receives only about 12 per cent of private-sector credit despite its weight in Uganda’s economy.
She said the financing gap is particularly pronounced among women, who account for a significant share of the agricultural workforce but often struggle to secure capital to grow their businesses.
Northern and Eastern Uganda also remain underserved by formal financial institutions, she said, making the expansion of financial services into the two regions a key part of the project.
ASA Microfinance Uganda Interim Chief Executive Officer Irene Maberi said the institution will identify areas with limited access to financial services and expand its branch network into those communities.
ASA will also introduce a USSD platform, allowing customers with basic mobile phones to access financial services without requiring smartphones or reliable internet connectivity.
Maberi said lending will be accompanied by financial literacy and business development support for borrowers.
About 5,000 women-owned agribusinesses will be trained in financial management, responsible borrowing and green finance, while approximately 320 ASA employees will receive specialised training.
aBi Finance Head of Investment Ann Marie Mwaka Sabano said the project will tackle some of the barriers that keep women with viable businesses outside formal credit markets, including collateral requirements, inadequate financial records and financial products that do not match their businesses.
For aBi Finance Head of Impact and Sustainability Noah Owomugisha, the test will go beyond the volume of credit disbursed.
He said the project will track whether businesses record higher sales, profits and incomes, and whether borrowers are better able to withstand climate-related shocks.
SPROUT is expected to generate more than 10,000 green loans, alongside at least 6,000 additional loans through ASA’s expanded branch network.
The partners also expect about 2,500 women-owned agribusinesses to graduate to larger loan facilities as their businesses expand.
The project places access to credit alongside climate adaptation, targeting farmers and rural businesses that need capital to invest in production while dealing with increasingly unpredictable weather conditions.
