By Charles Katabalwa
2nd Oct 2023
The Uganda Development Bank (UDB) has announced a UGX150 billion financial commitment to contractors under the Uganda National Association of Building and Civil Engineering Contractors for cheaper financing.
This comes after the negotiations between UDB and UNABCEC for better loan terms under the contractor association’s five-year strategic plan.
Patricia Ojangole, the UDB Managing Director while addressing the press at their Nakasero Head office, on Monday says that through this initiative, Ugandan contractors will enjoy benefits such as timely access to cheaper and patient capital, lower appraisal fees, grace periods of up to 12 months, 12% interest rate lower than prevailing market interest rates and access to bid bonds.
Ojangole adds Ugandan contractors need patient capital as they take a long time to make return on investment.
She says the cheaper loan is required due to delayed payments, particularly for companies working on government projects.
Application for this initiative will commence on October 3, 2023, and will close on 30th of this month and then an evaluation committee will review the applications against the minimum requirements.
Meanwhile, the president of Uganda Institution of Professional Engineers (UIPE) Andrew Muhwezi has applauded UDB for such a good initiative which he says will help contractors regain stability in their work.
Nearly 90% of members have experienced payment delays from the government.
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