Twelve entrepreneurs have been awarded $400,000 in seed funding following a partnership between the United States African Development Foundation (USADF) and Stanbic Uganda Holdings Limited (SUHL).
The five-year $2 million partnership is to provide development grants to Micro, Small and Medium sized enterprises (MSMEs), Cooperatives, and producer groups in Uganda, to help them address gaps in their internal systems and capabilities to 100% meet investment requirements by commercial investors.
USADF is pooling resources with SUHL’s anchor subsidiary Stanbic Bank. Stanbic Business Incubator Limited (SBIL), also a subsidiary of SUHL, is the implementers of the project.
Emma Mugisha, the Executive Director and Head of Business Banking at Stanbic Bank said, “Through this partnership, we are motivated and excited by the prospect of supporting Small and Medium Enterprises(SMEs) in the process of investment readiness through provision of grant capital and technical assistance.”
“Our aim is to catalyse agricultural growth in Uganda by empowering SMEs, cooperatives and producer groups operating within the agricultural sector for this first cohort. We shall support other mainstream sectors including but not limited to Energy, Health, construction, and other professional services that are aligned to Uganda’s National Development Programs,” Mugisha added.
Each partner will be contributing $200,000 (Shs756 million) over each of the five years. This investment ceiling will be reviewed every year with possibilities of increasing it to $500,000 (Shs1.8 billion) per year by each party.
Timothy Nzioka, the Director of Program Operations for Africa at USADF said, “This accelerator program is basically meant to make these SMEs investor ready by providing the necessary tools that help them address the challenges. We are looking at SMEs that are able to provide employment opportunities, those that are able to do value addition, amongst others.”
The program will fund MSMEs whose past investment proposals to financial institutions have been declined. The primary aim is to help the MSMEs address the gaps and challenges they face in qualifying for investments, link them to Stanbic Uganda and other financial institutions for potential follow-up on post grant commercial investment.
Each grant under the partnership will be valued up to $440,000 (Shs150 million) per MSME and will be implemented within a period of 12 to 24 months.
Officiating at the award ceremony, Robert Mukiza, the Director General of the Uganda Investment Authority (UIA) said, “As SMEs, look beyond the Ugandan market. In Uganda, we are about 45 million people on average but we are part of the East African Community and Africa at large, which have bigger market bases. You can end up becoming global leaders if you harness the huge market in Africa and beyond.”
Since its inception in 2018, Stanbic Incubator has contributed to the growth of over 3,800 SMEs around the country.
Tony Otoa, the Chief Executive at SBIL said, “As Stanbic Uganda Holdings, we believe that Uganda is our home, we drive its growth. Therefore, as the Incubator, we are proud to be part of Uganda’s economic growth through supporting SMEs who are the main revenue contributors to the country’s economy.”
