By Mulengera Reporters
A new independent evaluation report has exposed weaknesses in Uganda’s Agricultural Credit Facility (ACF), including poor customer service, inadequate loan amounts and gaps in awareness, raising fresh questions about the effectiveness of Bank of Uganda’s administration of the government-backed agricultural financing scheme.
The evaluation, conducted by the National Planning Authority (NPA) and released in May 2026, found that although the ACF has generated measurable economic benefits and effectively doubled the volume of credit available to agricultural borrowers since its establishment in 2009, beneficiaries continue to face challenges that could undermine the programme’s effectiveness.
Among the concerns is poor customer service by staff of participating financial institutions (PFIs) through which the Facility is delivered.
Although only four per cent of surveyed beneficiaries cited poor customer service as a challenge, the NPA says the problem remains noteworthy because the programme depends heavily on beneficiary engagement and trust.
Field reports cited in the evaluation indicate that some customers encountered unresponsive, dismissive or inadequately informed staff when seeking clarification or support during the loan process.
The finding raises questions about the quality of oversight of institutions implementing a programme administered by the Bank of Uganda and backed by public resources.
The NPA warns that poor customer service can have a disproportionate effect, particularly in rural and underserved communities where trust in formal financial institutions remains fragile. Negative experiences could discourage repeat borrowing, erode confidence in the ACF and weaken the word-of-mouth promotion that is important for rural outreach.
The evaluation recommends staff training, client feedback mechanisms and performance monitoring to ensure PFIs maintain service standards aligned with the development objectives of the Facility.
Loan amounts fall short
Customer service is not the only challenge confronting ACF beneficiaries.
Seven per cent of surveyed beneficiaries cited insufficient loan amounts, with the concern particularly common among applicants seeking financing for capital-intensive investments such as agricultural mechanisation, irrigation and post-harvest handling facilities.
The inadequacy of financing has forced some beneficiaries to scale down their investment plans or seek additional funds from more expensive commercial sources.
This risks diluting the very concessional benefit the ACF was designed to provide.
A borrower who receives an affordable ACF loan but cannot obtain enough funding to complete an investment may ultimately have to supplement it with costlier commercial credit.
The NPA consequently recommends reviewing loan ceilings to ensure that the Facility keeps pace with the changing financing requirements of modern agribusiness.
Awareness remains a problem
Despite the ACF having operated for more than 15 years, the evaluation also found continued gaps in awareness.
Two per cent of beneficiaries cited low awareness of the Facility, while another two per cent pointed to tax-related burdens. Seasonality-related factors were also cited by two per cent.
While these concerns affect relatively small proportions of respondents individually, the NPA says their combined effect reduces the overall effectiveness and inclusivity of the ACF.
Credit growth versus governance
The evaluation presents a mixed picture of the Facility.
On the one hand, the ACF has effectively doubled the volume of credit available to agricultural borrowers since 2009, demonstrating its contribution to expanding agricultural financing.
On the other, the NPA notes that the programme’s performance has largely been assessed through programme-level outcomes rather than structured governance indicators.
That distinction raises an important accountability question for the Bank of Uganda.
Growth in the volume of loans disbursed does not necessarily mean that beneficiaries are receiving adequate financing, sufficient information or quality service from the institutions responsible for delivering the programme.
The NPA calls for a comprehensive response involving systemic improvements, stronger customer-service standards at the PFI level and more targeted communication.
For the Bank of Uganda, the findings present a challenge that goes beyond increasing agricultural lending. The effectiveness of the ACF will ultimately depend not only on how much money reaches the agricultural sector, but also on whether borrowers can access sufficient financing and receive professional, responsive treatment throughout the process.
The ACF may have succeeded in expanding agricultural credit, but the NPA evaluation exposes weaknesses in the way that credit is being delivered — putting the spotlight squarely on Bank of Uganda’s oversight of the programme.
