By Rising Nation Editorial Desk
In a bold and strategically targeted initiative, the Government of Uganda, under the stewardship of President Yoweri Kaguta Museveni, has launched a game-changing intervention aimed at catalyzing inclusive economic transformation. The Affordable Empowerment Credit Program (AECP), officially unveiled on May 2, 2025, through the office of the Senior Presidential Advisor on Political Mobilization, Mr. Moses Byaruhanga, seeks to empower Uganda’s low-income earners—particularly market vendors and boda boda riders—by providing accessible, non-collateralized credit facilities at significantly subsidized interest rates.
The AECP represents a nuanced response to Uganda’s entrenched structural constraints within the informal sector, which constitutes over 60% of the nation’s workforce and yet remains largely excluded from mainstream financial services. The intervention, executed in partnership with the Microfinance Support Centre (MSC), signals a paradigm shift in public finance and grassroots economic inclusion.
At the core of this initiative are two tailored credit products: the “Katale Loan” for market vendors, and the “Boda Boda Loan” for motorcycle taxi operators. Under the Katale Loan scheme, vendors operating in formal markets across Kampala and other urban centres can now access capital at an unprecedented 8% annual interest rate, devoid of collateral or registration fees. As Mr. Byaruhanga articulated during the inaugural engagement at Kalerwe Market, “a Shs1 million loan will attract only Shs80,000 in interest per year”—a model of affordability that redefines microcredit in the Ugandan context.
The boda boda loan product, equally innovative, provides motorcycles valued at Shs6 million, with flexible repayment structures that culminate in ownership at Shs7.2 million—all without upfront deposits. The motorcycles will be equipped with GPS tracking and insurance coverage, mitigating risk while fostering financial discipline and asset security.
Microeconomic Impact: Enhancing Household Incomes and Enterprise Productivity
From a microeconomic lens, AECP addresses critical pain points among urban low-income earners: credit inaccessibility, vulnerability to income shocks, and limited capital accumulation. For market vendors, many of whom are women navigating precarious livelihoods, this initiative opens the door to reinvestment in stock, diversification of goods, and stabilisation of daily cash flow.
Women leaders such as Ms. Namata Justine, chairperson of the Kalerwe Women Vendors Association, lauded the program, stating: “The President through his support has helped women take care of their homes.” This sentiment encapsulates the social dividend of the AECP: economic autonomy for women, improved household welfare, and greater resilience against the vagaries of urban poverty.
The boda boda sector, a critical component of Uganda’s urban transport ecosystem, stands to benefit from structured asset acquisition—empowering thousands of young men to transition from renting to owning motorcycles, thereby enhancing long-term financial agency.
Macroeconomic Alignment: Inclusive Growth and Financial Deepening
The AECP is not merely a micro-level social intervention—it resonates profoundly with Uganda’s broader macroeconomic trajectory. As the country pursues its Vision 2040 development agenda, there is increasing recognition that inclusive growth must be underpinned by financial democratization. By targeting the informal sector, AECP extends the reach of fiscal policy into previously underbanked territories, thereby contributing to financial deepening and broadening the national tax base over the long term.
Moreover, the program aligns with the government’s industrialisation and urbanisation strategies, as articulated in the Third National Development Plan (NDP III), by providing capital to informal actors who serve as the lifeblood of urban consumption and distribution networks. The anticipated multiplier effect—where increased purchasing power stimulates demand, encourages entrepreneurship, and boosts productivity—can significantly augment Uganda’s GDP trajectory and reduce inequality.
Political Economy and Structural Reforms
Mr. Byaruhanga’s additional engagement on enforcement injustices—specifically cautioning the Kampala Capital City Authority (KCCA) against the confiscation of vendor merchandise—demonstrates the state’s intention to institutionalise respect for informal enterprise. His remarks that vendors should “take a video if anyone tries to confiscate your property and present it to the authorities” reflect a new social contract between the state and informal workers, rooted in protection, dignity, and empowerment.
His call for reforms on property tax, suggesting exemption for non-commercial owner-occupied dwellings, further underscores the administration’s commitment to progressive taxation and pro-poor fiscal policy.
In a symbolic yet substantive gesture, Mr. Byaruhanga also disbursed Shs5 million to luggage carriers and an additional Shs5 million to the Kalerwe Women Vendors SACCO, further amplifying the AECP’s grassroots impact. His pledge to support the Kawempe Boxing Club SACCO with capital and gym equipment reflects a comprehensive approach to human development that transcends economic empowerment alone.
A Nation on the Rise
The Affordable Empowerment Credit Program (AECP) is emblematic of a new era in Uganda’s development discourse—where economic justice, financial inclusion, and dignified livelihoods for the informal sector are no longer aspirational but actionable.
It is a recognition that true national transformation is not measured solely in megaprojects or foreign investments, but in the capacity of ordinary citizens to access affordable capital, build sustainable incomes, and chart their own futures.
In championing the AECP, President Museveni has once again reaffirmed his long-standing doctrine: that no Ugandan—however humble their enterprise—should be left behind in the march toward prosperity
