70% social enterprises neglected due to limited access to credit

A whopping 70 percent of social enterprises in Uganda suffer from lack of access to cheap credit despite the fact that they promote and drive inclusive growth and economic development, a senior economist has said.

Mr Richard Sempala, who is also a lecturer at Makerere University, believes government has not done enough in terms of funding to increase the uptake of Ugandans in social enterprises that would reduce unemployment, poverty and improve livelihood.

In Uganda, social enterprises remain the engine to reducing economic inequality, improving social justice and environmental sustainability through different activities they conduct.

According to a research report released by Capital Solutions in 2020, The report said 54.7 percent of the social entrepreneurs experience inadequate finances, lack of awareness on where to access cheap sources of finance and high bank interest rates.

At least 23.8 percent of the respondents mentioned that limited skilled employees to work for the enterprises and lack of specific policy or desk in government for social entrepreneurs.

“The government needs to look into the policy perspective while pushing funding to help these people create a balance for these enterprises to grow,” he said.

Sempala believes government policy in pushing funds to aid funding of social enterprises is the magic bullet to increasing the uptake of social enterprises, which would in turn champion unemployment and poverty in Uganda.