Centenary Bank, PSFU & aBi Trust earmark Shs338 million for financial literacy training in Uganda
KAMPALA. FEBRUARY 28, 2012. Centenary Bank, Uganda’s leading microfinance and commercial bank, Private sector Foundation Uganda and the Agribusiness Initiative (aBi) Trust, an entity devoted to private sector agribusiness development, have allocated over Shs338 million to impart financial literacy to Uganda’s businesspeople.
Mr Fabian Kasi, the Managing Director Centenary Bank unveiled the sponsorship at the launch of the second phase of the bank’s Financial Literacy Training Programme in Kampala on Tuesday, February 28, 2012. The new programme is designed to benefit at least 10 million businesspeople operating Small and Medium Enterprises (SMEs) in Uganda.
Speaking at a press conference today, Mr Kasi said, “At Centenary Bank, we know that opening a bank account, applying for loans and knowing how to withdraw or deposit money via an ATM is no longer sufficient for our customers. It is important that they are well informed so that they are able to ask for appropriate products to support and grow their businesses.”
For example, he added, “Our customers should know when to ask for a stand-by overdraft instead of a 2-year loan or vice versa. It’s in the ability to make such rational financial decisions that they can become competitive in business, hence the need for financial literacy training.”
Financial literacy is the ability to understand finance. More specifically, it refers to the set of skills and knowledge that allows an individual to make informed and effective decisions through their understanding of finances.
Mr. Gideon Badagawa, Executive Director PSFU commended Centenary Bank and aBi Trust for partnering with PSFU to implement the initiative. Mr. Badagawa said that financial literacy is one of the many challenges affecting small businesses in Uganda. “Small businesses find it difficult to access finance in part due to lack of collateral to secure loans but also because they are considered high risk clients,” he said.
High risk is attributable to a number of factors including poor management skills, uncertainty of their businesses and poor record keeping practices. “This training will therefore equip small businesses with necessary skills to enable them become more bankable,” Mr Badagawa noted.
Phase 11 training involves empowering the target group with skills on record keeping, managing family businesses, personal finance, power of networking and agriculture as a business. It is deemed to benefit entrepreneurs through classroom training in 10 districts (Kasese, Kabale, Gulu, Koboko, Kapchorwa, Tororo, Kayunga, Mubende, Kiboga, Wobulenzi), mentorship in 5 districts (Lira, Mbale, Mbarara, Arua and Kampala). This will be complimented by DVD recorded training, booklets, radio talk shows, radio interviews, Newspaper articles and TV live training will.
This is a continuation of Phase 1 financial literacy training where we reached over 50,000 people through classroom training and radio interviews in Lira, Mbale, Mbarara, Arua and Kampala.
aBi’s Managing Director Svend Kaare Jensen informed the media that Agribusiness Initiative Trust works with partners to strengthen both the demand and supply sides for agricultural credit in Uganda.
“Regarding the demand side, the Trust has supported programs assisting rural SMEs to prepare for loan appraisal by lenders,” Mr Jensen said. aBi Trust teamed up with Centenary Bank and PSFU, to support Phase II of the project following the successful implementation of Phase I which it closely monitored.
“We believe this expanded program will increase capacity in personal finance, bookkeeping, value addition & marketing. The result will be better skilled farmers and SMEs able to prepare meaningful loan applications for financing investments and thus get access to finance for their business operations,” Mr Jensen added. aBi’s involvement supports its vision of a competitive private sector led agriculture in Uganda. As such, he commended Centenary Bank on contributing to this Vision through Phase II.”
Mr Kasi urged beneficiaries in the different districts in which the programme will be implemented to prepare to participate in the next phase of the programme, to make it a great success.