In Uganda’s buzzing start-up scene, innovation is not the problem, access to finance is. For many young entrepreneurs with bold ideas and big dreams, securing funding remains one of the toughest challenges in turning a concept into a sustainable business.
While banks, SACCOs (Savings and Credit Cooperative Organizations), and other financial institutions have expanded their financing options over the years, most youth-led start-ups still face barriers to access.
Due to limited information, collateral requirements, and a persistent perception that formal financial channels are not meant for them.
“SACCOs Are for Big People”
A significant part of the problem is mindset. Many young Ugandans associate SACCOs with older, wealthier individuals.
To them, SACCOs feel like elite clubs for business veterans, not dynamic, youth-led ventures. Yet in reality, SACCOs were created to be inclusive community-driven platforms for saving and borrowing.
Most youths think SACCOs are seen as spaces for teachers, civil servants, or older farmers. there are less youth-centric branding and outreach, a big number does not even know the requirements or benefits, so many of them do not bother joining.
This information gap has created a cycle of exclusion: SACCOs fail to attract young members, and young people fail to benefit from affordable loans and structured savings options.
High Collateral Demands Lock Out Start-ups
Banks are even harder to approach. For most traditional financial institutions, lending remains a conservative practice rooted in collateral, formal business records, and multi-year projections.
This immediately sidelines informal, early-stage, or first-time business owners, the majority of whom are youth.
Most of the youths have got amazing ideas, but the security banks ask for is the bigger issue where most banks ask for land titles and audited financials and a few fresh graduates can own them
In the absence of formal credit, many start-ups turn to friends, family, or high-interest digital loans to bootstrap operations. But this often stifles long-term growth and pushes many into debt traps.
New Models and Development Efforts
To bridge the financing gap, development partners and some financial institutions are trying new models.
Several SACCOs, with support from government and NGOs, are starting to run financial literacy campaigns targeting youth.
In 2024, Uganda Cooperative Savings and Credit Union (UCSCU) launched a digital onboarding platform that helps youth open accounts and track savings through mobile phones.
Meanwhile, initiatives like the Youth Venture Capital Fund, EMYOOGA, and the Parish Development Model are slowly changing attitudes.
These government-led programs channel funds through SACCOs and local financial groups to target young entrepreneurs in key sectors like agriculture, services, and trade.
Building Trust and Tailored Solutions
To truly solve the financing puzzle, more effort is needed in trust-building. Many young entrepreneurs are wary of losing money in poorly managed SACCOs and over-promising loan schemes.
Transparency, good governance, and youth representation in SACCO leadership could help rebuild confidence.
There is also need for product innovation. Young business owners want flexible, low-interest loans that match their realities, small working capital loans, mobile-based repayment, or group guarantees in place of collateral.
A Future for Youth-Driven Finance
Uganda’s youth are creative, tech-savvy, and ambitious but without proper access to finance, their innovations risk dying early.
If SACCOs, banks, and policymakers want to harness the power of the country’s young entrepreneurs, they must listen more closely and design solutions that actually fit.
Because with the right financial support, today’s informal youth hustlers could become tomorrow’s job creators.
