FOTI Microfinance will provide microcredit services to women groups and youth groups in Tooro region and beyond. The purpose of this program is to support women and youth in Tooro region enhance their enterprises both individually and as a group.
Uganda still ranks amongst the twenty poorest countries in the world. Poverty is particularly prevalent in rural areas. With a share of nearly 50% of GDP, agriculture continues to dominate the Ugandan economy. Despite considerable productivity and output improvements for certain cash crops following the government’s liberalization efforts, the rural economy is still largely dominated by low productivity subsistence production.
While cash crop producers have benefited from liberalization, the large smallholder sector with average holdings of 1,6 hectares has seen very little real growth over the last decade due to lack of access to agricultural inputs, unaffordable financial services, declining soil fertility, poor infrastructure, information and communications and the inability to access output markets.
Numerous studies indicate that participation in microfinance programs contributes to reduced vulnerability to economic risks. Microfinance services help the poor in diversifying their income sources, building up physical, human and social assets, focus on good money management, rebuild the household’s base of income and assets after economic shocks have occurred and to smooth consumption (Cohen 1997; Cohen 1999; Hulme 1998, Ito 1998; Sebstadand Chen 1996).
FOTI Microfinance Support Program is building on the strong microfinance infrastructure in Uganda to widen and deepen microfinance services in Tooro region. It will among others provide loans to women and youth groups in Tooro region and beyond, offer trainings in financial literacy and loan management and it will also offer capacity building in business development.
In the next 5 years FOTI Microfinance Support Program will provide microfinance services to 50,000 women and youths in Tooro region and beyond.