Project detail - Watu Credit Uganda Limited

Watu Credit Uganda Limited

Status: Approved investment
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The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.

Who is our customer

Watu Credit Uganda Limited (‘Watu’) is a micro-lending company providing pay as you go financing to young entrepreneurs operating motorcycles (boda bodas) and tuk tuks transport businesses in Uganda. Watu is wholly owned by Watu Holding Limited registered in Mauritius and with operating companies in 6 countries in Africa, and with plans to grow further across the region. Watu’s mission is to meaningfully improve employment and opportunities for those with the greatest barriers to access financial services. Watu has been operating since 2019 and currently has operations across Uganda serving more than 40,000 clients. 90% of Watu’s clients are young entrepreneurs (aged between 20 and 28 years) and 70% are based in rural areas.

What is our funding objective?

FMO’s loan will be used for on-lending purposes to self-employed individuals and will be used to specifically grow Watu’s youth and rural focused MSME mobility portfolio in Uganda.

Why do we fund this investment?

The proposed facility provides an opportunity for FMO to support one of the top micro-lending institutions in Uganda to increase its MSME lending activities with a particular focus on youth owned and rural mobility MSMEs. As a non-deposit taking institution, FMO's long-term funding is also providing Watu with stability and security of funding to enable it to further grow and expand its reach across Uganda.

What is the Environmental and Social categorization rationale?

Watu Credit Uganda is categorized as a low E&S risk (C) client based on FMO's policy with no IFC Performance Standards triggered transactions and in full compliance with FMO's exclusion list and national laws of Uganda. However, given the nature of the underlying mobility portfolio and their focus on individuals and micro entrepreneurs, the institution is considered a high risk for Client Protection Principles (CPPs). Therefore, FMO's loan is being provided together with capacity development to support the development of sector safety and awareness initiatives. The client is committed to comply with the CPPs and to address any gaps identified through the external assessment to become CPP certified.

Financial Institutions
Publication date
Effective date
Total FMO financing
USD 5.00 MLN
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)