New Loan Product to Boost Banana Production in Uganda
No crop occupies as central a place in Ugandan society as bananas. Ugandans consume over 2 pounds per capita daily of bananas in the form of cooked plantains, locally known as matooke. The country is not only the biggest consumer of bananas in the world, but also its largest producer, behind only India.
In addition to being the primary source of nourishment for most Ugandan households, bananas underpin livelihoods and the economy. Commercial farmers across the country bank on it as a source of guaranteed income, and manufacturers depend on it as a vital ingredient in food products, beverages and cosmetics. Banana’s popularity is reflected in its extensive adoption as a staple and cash crop—three-quarters of all farmers in the country grow it.
Introducing Banana Loans for Ugandan Farmers
Recognizing the crop’s value in the country, FINCA Uganda introduced the Banana Value Chain Loan to help commercially oriented farmers boost production and marketing. The loan can be used to cover costs across the value chain, from production inputs to post-harvest handling and marketing. Farmers who have been involved in banana production for at least two years and own at least an acre of banana farmland can apply for the loan.
For its pilot in July, the loan was rolled out to members of the Mbarara District Farmers’ Association, which boasts over 1,000 farmers in western Uganda, the region with the largest production of bananas in the country.
Eligibility for the loan also requires farmers to undertake training in good agricultural practices to maximize productivity. FINCA Uganda has partnered with the German development agency, GIZ, to oversee the trainings and issue certificates. Farmers must undergo a minimum of three trainings before they can qualify for the loan.
Evace Nyabagyenda, a farmer from Isingiro District, was one of the earliest beneficiaries of the Banana Value Chain Loan. Having graduated from the GIZ training, Evace is more confident than ever of reaping huge rewards from the investment.
The training empowered me with knowledge and skills to take good care of my banana field and crops. I can now expect improved yields come harvest season.
With the loan she received following the training, Evace bought fertilizer for her banana farm. She says she is actively encouraging other farmers in her community to apply for the loan so that that they can become more productive and earn more money from the country’s most popular crop.