Stanbic Bank and traders under the umbrella body, Kampala City Traders Association (KACITA), recently signed what they described as a ground-breaking trade and tax partnership pact that will ease the clearing of their imports.
Stanbic Bank and KACITA say their partnership will significantly ease traders’ ability to source goods from Asian markets as well as pay the stipulated taxes on the imported items. Ultimately, this is expected to improve compliance and transform Uganda’s small and medium enterprises (SMEs).
Anne Juuko, the chief executive officer of Stanbic bank Uganda, said the partnership will provide some relief to traders as a result of disruptions in the global supply routes.
Under the partnership, Stanbic bank has agreed to facilitate the importation of goods from China and other Asian countries through its Subula Express proposition.
On top of that, the bank will create special trade accounts at various branches to cater to the traders’ requirements and at lower transaction charges.
Juuko said the bank has also agreed to scale up lending to bankable enterprises, which previously was not possible since they did not meet certain internal lending thresholds.
Most importantly, the partnership will see Stanbic bank provide special loans that meet the needs of the traders. For example, under one arrangement, already existing bank customers recommended by KACITA will qualify for unsecured loans not exceeding Shs 200 million.
New customers will also qualify for loans not exceeding Shs 200 million under a collateral management arrangement. Henry Musoke, the acting chairman of KACITA, said they will ensure there is a free flow of information between itself, the bank, and URA.
In order to ensure compliance, KACITA will also work with Stanbic bank in the development of these initiatives to improve and expand support to the traders they transact with.
Meanwhile, in a bid to ease tax collection and compliance, KACITA will ensure that all recommended customers will have to be enrolled on the Electronic Fiscal Receipting and Invoicing System (EFRIS) where applicable.
Speaking at the launch, David Bahati, the state minister for Industry, appealed to traders to take advantage of the Stanbic partnership to pay taxes while adopting professional approaches such as bookkeeping to do business better.
Official statistics from URA show a huge trade imbalance between Uganda and China. According to URA commissioner customs, Abel Kagumire, Uganda imported goods worth Shs 6.2 trillion from China in the last financial year (2020/21). In comparison, the country exported goods worth a paltry Shs 53 billion to China in the same period.