Slyvesto Kibirango 32, is a business man running a retail shop in Zirobwe Trading Centre, Bamnanika County, Luwero district. He is one of the pioneer clients of Uganda Micro-Finance Limited at Zirobwe Branch, who has benefited from the Solidarity Group Lending Scheme’s working capital loan, offered by the Institution. Slyvesto shares with the African Executive how the loans he has acquired have drastically changed his life and benefited his entire family.

Q. Tell us your kind of business.

A. I mainly do retail business. I sell foodstuff like posho, beans, sugar, groundnuts and simsim. I also sell toiletries such as Blue Band, vaseline, baking flour, clothes, towels, bags of various types, paraffin and washing powder. My list is long because I keep changing items depending on the market. To supplement the business, I farm and do trade in coffee beans seasonally.

Q. For how long have you been doing this business?

A. For the last 5 years.

Q. How has it been performing?

A. When I had just started the business, I sold a few goods because I had very little capital and the profits were so meager. My wife would sell tomatoes, onions and some other food crops to help support the business. But today, my business has improved greatly. My shop is well stocked and I get good profit.

Q. What did you do to improve the business?

A.  My brother in law told me about the working capital loan that was being given out by Uganda Micro-finance limited, a local credit institution with a branch here in Zirobwe. He was already a client at the branch and I had noticed his business was growing. When he invited me to join his group, I decided to try it out.

Q. What happened next?

A. When I visited the branch, I was taken through the policies and procedures of borrowing from the Institution. I then opened a savings account, bought an application form and gave it to all my group members to sign. A field officer came to my place and verified my business and residence. After two days, the loan was deposited on my account.

Q: How much was it?

A. It was Ugshs. 500,000.

Q: What did you use the money for?

A. I purchased and stocked edible goods like posho, beans, and other fast moving items like salt, pounded groundnuts, paraffin and sugar. My wife also injected part of the money into small fish business (Mukene) because most people in this village like it and it's highly purchased.

Q. Did you have any problem in paying back the loan?

A. No. I was given a grace period of one month to repay the loan. The good thing with the scheme is that the loan is paid in installments. The loans officers calculate the interest at 4% per month on reducing balance depending on the number of months and add it up with the principal.  They then divide that amount by the number of months in which we have agreed to pay the loan and we are given consolidated flat installments to pay per month. Because I was trading in fast moving items mainly, I managed to pay the loan back on time.

Q. How many circles have you completed so far?

A. Am in my 8th circle now.

Q. Are you still borrowing the same amount of money today?

A. No. I have borrowed Ugshs. 4 million in this circle. Since I was paying back so well, I managed to graduate to borrowing larger amounts of money. The only difference now is that I am borrowing individually; not in the group system.

Q. Apart from improving your business, is there any other way in which you have benefited from these loans?

A. Yes.  I bought a piece of land and I am now in the process of constructing a three bed roomed residential house for my family. My children are going to good schools and I do not find it difficult to pay their school fees. Apart from the individual loan, Uganda Micro-finance limited also allows one to borrow school fees loans. I have a daughter and a son in secondary school in Kampala and another son pursuing an undergraduate course at Kyambogo University.

Q Are there some limitations of the credit scheme?

A. Well, I do not see any disadvantage of the scheme. Problems only come when one fails to repay the loan as a result of misusing the money, theft or diverting it into other long term ventures that flop. Some of my group members experienced such problems and we had to bail them out. This affects the performance of the group at the end of the day.

Q. Where do you see yourself in the next five years?

A. I will be the owner of a large wholesale store selling items like mattresses, blankets and drinks.

Q What do you have to tell other small scale business men and farmers who are out there and have never tried getting credit?

A. Credit can be a means to improving their businesses. They should not hesitate to get loans from Micro-finance Institutions or banks because some like Uganda Micro-finance Limited, Pride Micro-finance and Finca Uganda do not ask for security especially for the group loans.  I have done so and I have no regrets. Instead, I appreciate what they are doing to improve our lives here. Many low resource farmers and business men in this area have benefited, so I am calling upon those who have never borrowed to do so in order to create a positive difference in their lives.