We are happy to announce that we have a new provider joining the MYC4 platform today, namely Uganda Microcredit Foundation Ltd (UMF). Founded in 2008, UMF has been in operation for 5 years and is based approximately 25 kilometers from Kampala, the capital of Uganda, in the town of Seeta. UMF has 35 staff and a total of four branches, all of which are peri-urban or rural.
UMF offers microfinance services to its members at the grass root level who are mainly involved in informal business activities including agriculture. The market targeted by UMF is largely composed of clients that are financially excluded from the mainstream financial sector. So far, UMF has built a loan portfolio of around €700,000 with close to 1,400 active clients and a portfolio at risk above 30 days (PAR30) of 2.3 %.
The mission of UMF is to “mobilise resources, offer inclusive financial and non-financial services to empower the people of Uganda especially in the rural areas, through well designed customer tailored financial products and services in order to facilitate economic growth and development”. Its vision is to “be the champion of the socio- economic transformation of the people of Uganda”.
Three different types of loan product have been developed for UMF’s pilot phase on MYC4:
- Agriculture – Loan product offered to people involved small agri-business activities to help them improve productivity and their incomes. It is offered through individual lending methodology and ranges in size from €250-€5,000.
- Commercial – Loan product offered to small business entrepreneurs involved in trade to improve their working capital. It is offered through individual and group lending methodology with loan sizes between €250-€10,000.
- Housing – Loan product offered to people involved in any income generating activity to help them construct a new house or improve on the existing one for both residential and commercial purposes as a way of improving their livelihood and incomes respectively. Loans range between €250-€5,000.
It is expected that the payback period on loans uploaded during the pilot will be around 12 months on average, and maximum investor interest will range between 12-18 % depending on the product and the loan size.
The on-site training of UMF has started this morning and we look forward to seeing the first loans from UMF open on the platform later this week or no later than early next week. If you would like to know more about UMF, follow this link to its brand new Provider Profile.