Investment by small and medium sized companies across Uganda will benefit from significant new funding being provided by Europe’s long term lending institution. The European Investment Bank will provide a total of EUR 28 million, equivalent to Ushs 96 billion, to Crane Bank for onward lending to local firms in both Ugandan shillings and foreign currency. This new loan represents the third European Investment Bank lending programme to be managed in Uganda by Crane Bank.
Under the credit line, both existing and new customers of Crane Bank will be able to benefit from the loans. Companies operating across a broad range of sectors, including manufacturing, agroindustry, tourism, and services, will be able to apply. The loans can be drawn in any combination of currencies – UGX, USD or EUR – for maturities of up to 10 years with grace periods included.
“Small business investment is essential to unlock business opportunities and create new jobs. The European Investment Bank is pleased to continue its long-standing partnership with Crane Bank that enables Ugandan firms to invest in new sectors and flourish. This new support builds on our strong track record of supporting private investment across East Africa in close cooperation with leading local financial partners.” said Pim van Ballekom, European Investment Bank Vice President.
This new lending programme backed by the European Investment Bank is the largest ever partnership with Crane Bank. Previously, EIB schemes lent Crane Bank EUR 3 million in 2007 and EUR 12 million in 2010. Past lending has supported nearly 1,000 jobs in manufacturing and tourism companies.
This loan to Crane Bank is part of the European Investment Bank’s broader support to SME lending by commercial banks in East Africa. In the last five years, the European Investment Bank has provided over EUR 400 million to 26 different financial institutions in East Africa, including commercial banks, development banks and microfinance institutions through dedicated SME and microfinance credit lines.
To strengthen the financial sector in the region, the EIB is currently implementing a EUR 5 million technical assistance programme that will help local banks to broaden their range of financial services and help local companies to prepare bankable projects. Crane Bank is eligible to participate in this programme.
Support for private sector investment is a key priority for the European Investment Bank and last year EUR 22 billion was provided to companies through local financial partners across Europe and around the world.