Lack of access to financial services by farmers remains one of the major hindrances to higher agricultural productivity in Uganda, according to experts.
The Uganda Agricultural Census survey 2008/2009, indicate that only 11.3% of the 3.9 million agricultural households in Uganda access credit.
Access to financial services as loans, savings accounts, remittances and insurance are crucial to achieve higher agricultural productivity.
It is against this background, that dfcu bank in partnership with the Netherlands based Rabo bank set up an Agriculture Advisory Center to help Ugandans.
Jimmy Mugerwa, the chairperson dfcu Bank, revealed that the advisory center will be operational by July this year.
“With Uganda’s heavy reliance on agriculture, it is critical that there is cross industry collaboration to support the shift from subsistence to commercial farming which is more lucrative,” Mugerwa said.
Although 75 percent of rural household in Uganda derive their income from agriculture, few are able to get the financial support they need to help them improve on their farming.
Teddy Wanzula, a farmer from Soroti said, she has been able to sustain her farming through getting financing from the bank which is not the case with other farmers.
“If it wasn’t for financing from the bank, I was not going to open up more land and employ more technology. As farmers we need accessible finance services,” Wanzula said.
Vision Group’s Chief Executive Officer, Robert Kabushenga also testified how he was able to establish an irrigation system at his farm, through support from the bank.
“I got a loan for my irrigation system from dfcu bank, I wouldn’t have made it on my own,” Kabushenga said.
According to Mugerwa , dfcu’s advisory center will complement the efforts towards improving the skills set with in the agricultural sector.
He revealed this on Thursday during the flagging off ceremony of the 13 winners of the 2016 Best farmer’s Competition who will be leaving for the Netherlands on Saturday.
The farmers were flagged off by the minister of state for agriculture Christopher Kibanzanga at dfcu bank headquarters in Kampala.
“You need to do agriculture as a business. Invest in agriculture to get money, aim at creating capital and food will just come,” Kibanzanga said.
Despite several interventions in agricultural financing by government, access to credit by smallholder farmers has remained very low.