Agriculture is the backbone of Uganda’s economy, contributing about a quarter of GDP and employing more than 70 percent of the population. Yet, for the millions of smallholder farmers who sustain the sector, farming remains a high-risk venture.
Access to affordable credit is limited, insurance penetration in agriculture is almost negligible, and climate change continues to magnify uncertainties.
Financial institutions have long considered smallholder farming too risky, while insurance companies remain hesitant to cover weather-dependent ventures. With unpredictable rains, prolonged dry spells, and rising input costs, small farmers are often left to absorb shocks alone.
But in the Rwenzori region, spanning districts such as Kabarole and Bunyangabu-cooperatives and Savings and Credit Cooperative Organizations (Saccos) are emerging as a lifeline, offering smallholder farmers a fallback position and an opportunity to grow from subsistence to sustainable commercial agriculture.
For Titus Nuwe, the secretary of Kyankara Burungi Bweka Outside Catering and Farmers Group in Kyankara (Rwenzori region in Fort Portal) collective action has been the difference between despair and survival. ‘Being in a cooperative gives us a fallback position in case of calamities,’ he says.
‘When one part of the project is affected, we still have another to rely on.’ Started in 2017, the group has grown into a multi-activity cooperative, combining outside catering, pumpkin growing, and beekeeping. The latter was introduced in 2024 under the Apero Project, with just 10 beehives. Today, the group manages 30, thanks to support from development partners like the BRAIN project, which provided a honey extractor.
‘Beekeeping needs little attention and gives a high return. With the extractor, we produce cleaner honey without damaging the combs, so bees resume production faster,’ Nuwe explains.
But even beekeeping has its setbacks. Continuous rains this year reduced bee activity, leaving the insects to consume much of their honey stock. Adding that what would have been a devastating blow was softened by the cooperative’s diversified activities. Pumpkins-pollinated by the same bees-offered a safety net, while the catering arm of the group provided additional income.
‘The strength of a cooperative is that even when one project fails, others keep us afloat,’ Titus adds.
Saccos as community banks
Beyond farmers’ groups, Saccos have become the rural equivalent of banks-offering credit, savings, and stability. Kijura SACCO, based in Kabarole, is a prime example of how these institutions are reshaping rural finance. According to General Manager Gerald Ngiramahoro, the Sacco has seen exponential growth in recent years. Its assets now stand at Shs6.25 billion, up from just under Shs2 billion before interventions from the Breakthrough Entrepreneurship Project.
‘As of August, our savings stood at Shs 2.7 billion, loans at Shs 4.73 billion, and membership had exceeded 10,000-compared to only 6,000 a few years back. Our share capital has also more than doubled to Shs 1.26 billion,” Ngiramahoro says.
Part of this transformation has been institutional reform. Following recommendations from the project, Kijura Sacco recruited an internal auditor-an unusual move for many community financial institutions.
‘The internal auditor has greatly strengthened our internal controls and transparency,’ Ngiramahoro explains.
‘Members now trust us more, and that trust has been reflected in higher savings and borrowing.’ The Sacco’s ability to extend affordable credit has helped farmers expand farms, invest in livestock, and acquire inputs without turning to exploitative moneylenders. This role has made Saccos indispensable in de-risking agriculture.
Shamim Nalubega, communications manager, BRIGHT Project IFDC, the project has strengthened smallholder farmers’ access to formal financial services, with 5,328 households benefiting from loans and support.
‘Four Saccos secured Shs2 billion for onward lending, while three cooperatives received Shs 300 million through the Blended Finance Facility from Pearl Capital Partners. Five Saccos have also refined their agricultural loan products, including input loans, micro-loans, and green financing,’ she says.
Adding that strategic partnerships have further boosted market access and inputs, with 38 memorandums of understanding signed with private companies, cooperatives, Saccos, and farmer groups, and nine agricultural input sale points established.
Seed multiplication efforts reached 4,373 farmers through 25 training sessions, while seven local seed businesses and a partnership with Farm Inputs Care Centre Ltd support tissue culture plantlets. Additionally, 15 cooperatives and Saccos (65,894 members) and 258 farmer groups (9,983 members) have been empowered to improve production, bulking, market engagement, and financial access.
Partnerships driving transformation
Government and development partners are also playing a catalytic role in helping smallholder farmers transition to modern, resilient agriculture. In Bunyangabu District, the District Agricultural Officer, Gerald Tumwesigye, highlights collaborations with organizations such as IFDC, which have equipped farmers with training, inputs, and financial literacy.
‘We’ve worked with several partners to organize our farmers into cooperatives,’ he says.
Noting that initiatives such as International Fertiliser Development Centre (IFDC) and the BRIGHT project have provided modern beekeeping equipment such as KTB hives, alongside training on value addition. Nutrition-sensitive initiatives like kitchen gardening are helping families grow vegetables at home, addressing malnutrition and reducing dependency on market food.
‘It’s encouraging to see women and youth growing their own food and feeding their families.
‘These simple innovations are sustainable and impactful,” Tumwesigye notes. The district has also tackled land degradation in its highland areas by supporting tree nurseries and replanting bare hillsides, reducing erosion and flood risks.
A collective path forward
For now, cooperatives and Saccos remain the most practical fallback for smallholder farmers. They provide credit where banks will not, pool resources to withstand shocks, and offer a sense of solidarity in a sector vulnerable to climate change.
As Nuwe puts it, ‘Even when one season is bad, the group continues. That’s the strength of working together. With stronger institutional support, reliable extension services, and continued partnerships, the cooperative model could be the key to unlocking the full potential of Uganda’s agriculture-ensuring that smallholder farmers not only survive but thrive.’