Shs 176 Billion Financing Scheme For Private Large-Scale Commercial Farmers Launched

Finance Minister Matia Kasaija recently announced the launch of this new financing scheme for private large-scale commercial farmers, designed to provide timely, affordable, and accessible financial resources to farmers who are at the heart of our agricultural economy.

This financing mechanism will support private large-scale commercial farmers to produce 132,600 metric tons (MT) of maize, beans, soya beans, sorghum and animal feeds on a total proposed acreage of 114,661 acres.

This will be implemented by having Government-owned financial institutions (Pride Microfinance, Post Bank and Housing Finance) provide a principal amount of Shs176 billion, and the Government of Uganda (GoU) meeting the corresponding interest component of Shs 40 billion annually.

Kasaija, while launching the scheme at Speke Resort Munyonyo, said farmers face a multitude of challenges – ranging from unpredictable weather patterns and rising input costs, to limited access to technology and, most pressing of all, financial support.

“In recent years, we’ve seen how critical it is to support farmers with the right tools to thrive. Grain production is labour-intensive, requiring substantial investments in land preparation, seeds, fertilizers, irrigation, equipment, and more,” said the Finance Minister.

This scheme will initially run for a period of six years and the eligibility criteria take into account companies, cooperatives and other formal qualifying entities with available land or engaged in large-scale farming with a minimum of 50 acres of land. Loan disbursements have been structured to align with farming cyclesso that the resources can be received and utilized at the point they are most needed by the farmers.

“To our farmers here today – this is your opportunity to take your operations to the next level. With the right financial support, you can access better equipment, expand your land and improve your yields,” said Kasaija.

The Minister of Agriculture, Animal Industry and Fisheries,Frank Tumwebaze, thanked Government for responding to the needs of private large-scale farmers and strengthening the partnership between Government and farmers.

Tumwebaze said the money was not for trading but real production, adding that his Ministry will share with all stakeholders the profiled large-scale farmers in all the districts of Uganda.

Earlier in his welcome remarks, the Permanent Secretary and Secretary to the Treasury (PSST), Ramathan Ggoobi,said this launch marked a pivotal moment in Government’scontinued efforts to empower farmers, enhance food and feed security, and drive sustainable agricultural growth in our nation.

The PSST said this scheme will support Government’s Tenfold Growth Strategy that aims to grow Uganda’s gross domestic product (GDP) from about USD 50 billion in FY2022/23 to USD 500 billion by 2040. Agro-industrialization, an anchor sector of the strategy, aims to commercialize and formalize farming, leading to a fivefold growth of agro-industrial exports with an estimated value of USD 20 billion.

With the forthcoming transition to the Fourth National Development Plan (NDP IV), Ggoobi said the target is to increase the share of agricultural exports (maize, beans, soya beans and sorghum) from USD 2.45 billion (35%) in FY 2024/25 to USD 4.76 billion (48%) in 2029/30. Maize, also one of the commodities under this scheme, is expected to contribute USD 335.3 million.

The launch was witnessed by the Managing Directors and Chief Executive Officers of the respective commercial banks, the Executive Director, the Grain Council of Uganda, and the President, Uganda National Farmers Federation, among others.