Agricultural Credit Facility – Agriculture Loan

Posted 6 months ago


The Agricultural Credit Facility (ACF) was set up by the Government of Uganda (GoU) in partnership with Commercial Banks, Uganda Development Bank Ltd (UDBL), Micro Deposit Taking Institutions (MDIs) and Credit Institutions all referred to as Participating Financial Institutions (PFIs). The Scheme’s operations started in October 2009, with the aim of facilitating the provision of medium and long term financing to projects engaged in Agriculture and Agro processing, focusing mainly on commercialization and value addition.

Investment Details

Eligible projects include acquisition of agricultural machinery, post harvest handling equipment, storage facilities, agro processing, mechanization and any other related agricultural and agro-processing machinery and equipment. Agricultural inputs required for primary production and working capital requirements are considered provided this component does not exceed 20% of the total project cost for each eligible borrower. The scheme also provides financing for Working capital and infrastructure for projects engaged in grain trading.

Funding Procedure

The client forwards his/her loan application to any PFI of his/her choice. The PFI will then advise him/her on the terms under the ACF. A detailed bankable project proposal/feasibility report may be required by the PFI (depending on the loan amount applied for).

Fund Structure

Interest Rate The interest rate to the final borrower is up to a maximum of 12% per annum. The 50% GoU contribution is disbursed to the PFIs at zero Interest (interest-free). Facility fees Loan processing fees charged by PFIs to eligible borrowers should not exceed 0.5% of the total loan amount. Legal documentation and registration costs are borne by the borrower.

Target Impact

The main objective of the ACF is to promote commercialization of Agriculture through provision of medium and long term financing to projects engaged in agriculture, agro processing, modernization and mechanization.



The Scheme shall not be used for financing working capital for purchase of land, forestry, refinancing existing loan facilities and trading in agricultural commodities with the exception of grain.