MBARARA- The Head of Agriculture Credit Facility (ACF) at Bank of Uganda (BoU), Ms Rosette Bamwine, has challenged farmers to take advantage of the fund and commercialise agriculture.
Ms Bamwine said money is available in 34 commercial banks, micro deposit and credit taking institutions.
Ms Bamwine, while speaking at the BoU dialogue and exposition at Mbarara University of Science and Technology last Friday, said loans under ACF are given to farmers and agro-processors at 12 per cent interest rate per annum.
She added that the scheme administered by BoU started in 2009. She said one can qualify for the loan if they are going to acquire agriculture machinery and post harvesting handling equipment, storage facilities and agriculture inputs like pesticides and fertilizers, among others.
“All financial institutions are mandated to issue ACF having signed a Memorandum of Understanding and participation agreement,” Ms Bamwine said.
The maximum loan period is eight years and the minimum is six months. According to Ms Bamwine, one can borrow up to Shs2.1 billion.
Role of ACF
The Deputy Governor BoU, Dr Louis Kasekende, said ACF was established to provide medium and long term financing for commercialisation of agriculture.
He added that there is an outcry over high interest rates which he said partly explains why banks are relying on demand deposits. He said developing the pension sector and insurance will help mobilise long term financial resources and lower the interest rates.
“I get concerns from the public about the high interest rate that stands at between 15 and 20 per cent. Most of the deposits we (public) have with commercial banks are demand deposits. You can’t lend that money for five years,” Dr Kasekende said.
He added: “We need to develop the insurance and pensions sector. These are major sources of medium and long term resources.”
atumushabe@ug.nationmedia.com
0 comments:
Post a Comment