Ugandan Micro-Businesses Receive €100 million Support Through EIB Global and Centenary Bank Partnership

European Investment Bank (EIB Global) and Centenary Rural Development Bank Ltd (“CERUDEB”) have today announced the agreement to make €100 million available to private sector enterprises, with a focus on female borrowers and microenterprises in rural areas.

This investment represents EIB Global’s largest ever microfinance loan to any country in the African, Caribbean and Pacific (ACP) regions. 

The final beneficiaries are micro-entrepreneurs or micro-enterprises with less than 10 full time employees. The investment also aims at supporting lending to financially underserved entrepreneurs in rural areas as their businesses continue to recover from the COVID-19 pandemic. 60% of the funding shall go to projects in rural areas outside the capital city of Kampala.

CERUDEB shall use at least 50% of the financing to support women-run or women-owned businesses, in line with the EIB’s 2x Challenge criteria and SheInvest initiative.

The press announcement on the investment partnership between the two financial institutions was made ahead of the formal signing of the deal during the EU-Uganda Business Forum, in the presence of Uganda’s President Museveni.

As per a previous United Nations Capital Development Fund (UNCDF) Uganda Business Survey from 2020, micro-firms and female-led firms face the largest constraints, with 80% of the firms reporting difficulties in access to capital. Financial services uptake indicates that only 11% of firms have a bank loan or line of credit, a proportion less than half of the average of countries in Sub-Saharan Africa. Most micro- and small enterprises remain excluded from mainstream banking because the focus tends to be more on corporates and high net-worth individuals.

EIB Head of the Regional Hub for East Africa, Edward Claessen said: “According to recent studies, access to finance remains the greatest obstacle to investment in Africa. Micro-firms and female-led firms face the largest constraints, with majority of the firms reporting difficulties in access.  The funding opportunity offered to Centenary Rural Development Bank will go a long way in addressing these challenges and spurring the economic growth of Uganda.”

Speaking during the press announcement, Mr. Fabian Kasi, the Managing Director at Centenary Bank said: “This partnership investment aligns with Centenary Bank’s strategy and reinforces our focus to grow our “mission critical” portfolio, particularly extending our financial inclusion agenda to the bottom of the pyramid through increasing access to credit in the areas of microfinance and agriculture lending. Currently we allocate 20% of the lending portfolio to Agriculture.” 

Mr. Kasi further explained that the bank will target to issue 1.9 million loans to small growing business and micro-enterprises, with a specific focus on empowering 970,000 women or women-run businesses and 1.17 million loans to micro-enterprises in rural areas. “This is not merely about the numbers; it is about transforming lives sustainably, uplifting communities, and laying the foundation for a more inclusive and resilient economy,” said Kasi.