EDUCATION

SCHOOL REOPENING: Stanbic Bank to write-off accumulated interest on loans owed by indebted private schools

Dr Kendrace Turyagenda, Director of Education Standards in the Ministry of Education speaks at the press conference as Stanbic CE Anne Juuk looks on (PHOTO /Courtesy)

Dr Kendrace Turyagenda, Director of Education Standards in the Ministry of Education speaks at the press conference as Stanbic CE Anne Juuk looks on (PHOTO /Courtesy)

KAMPALA—Stanbic Bank Uganda has on Wednesday, January, 2022 announced the immediate availability of UGX60billion in hugely discounted ‘booster financing’ to the education sector a move aimed at supporting the ongoing nationwide reopening of schools after nearly two years of inactivity.

Under the discounted booster finance, schools are able to borrow up to UGX500M in collateral-free (unsecured) loans to prepare their institutions for reopening. Parents can also access up to UGX250million in unsecured loans processed digitally and dispersed within five minutes at zero processing fee.

Stanbic Bank further revealed that its decision to waive all 2021 unpaid accumulated interest on loans to privately owned schools is a proactive initiative based on the understanding that schools have not been earning and that they need to be supported to regain their ability to settle their liabilities.

Anne Juuko, the Stanbic Bank Uganda Chief Executive said the ‘bold decision by management even in the face of uncertainty, speaks to our commitment to walk the talk of our business purpose, which is that we drive Uganda’s growth, as such, we have to exercise our corporate responsibility to the country’s education sector.’

She added that, “the Covid19 pandemic has left us with an unprecedented challenge; our schools have been closed and teachers have been out of work for two years, many parents and guardians also had their livelihoods interrupted as a result of loss of jobs or business.

“We at Stanbic Bank are taking bold steps to play our corporate responsibility to support the government and other stakeholders in facilitating a successful reopening of our learning centers,” she said.

Collectively, privately owned schools and teachers, owe financial institutions over UGX1.5trillion in loans, with nearly UGX500 billion in accumulated interest alone.

According to the Education Ministry, the sector requires UGX500bn in the medium term of which UGX150bn is needed immediately, to support successful reopening of learning centres, countrywide.

As Uganda’s largest lender by assets with over 30% market share, Stanbic Bank shoulders the bulk of loans to the education sector and private school proprietors have hailed the bank’s display of corporate leadership by waiving accumulated interest on loans to schools for 2021, as reassuring to the sector.

“We were worried as private school owners that we would be on our own in dealing with commercial banks; I am relieved and encouraged that the government’s engagement with commercial banks is yielding good concessions such as this one by Stanbic Bank; waiving payment of accumulated interest for 2021 is indeed a true boost for us,” said Hajji Nanfumba Mustafa, the Director, Mpigi Mixed Secondary School.

Dr Kendrace Turyagenda, the Director of Education Standards in the Ministry of Education and Sports has lauded and welcomed Stanbic Bank’s corporate leadership and urged other players in the financial sector to play their part. She noted that the successful reopening of schools will require all stakeholders to play their part.

“Education is our collective responsibility which we cannot leave to the government alone.The Ministry of Education strongly commends the proactive gesture by Stanbic Bank for placing its corporate social responsibility above business interest, by waving accumulated interest payment on loans owed by our schools,” said Dr Turyagenda.

Uganda’s education sector is over 28,000 schools’ strong of which 80% are privately owned. With over 500,000 teaching and non-teaching staff and over 16 million students, the sector contributes circa 5% to the country’s GDP.

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