teaching the customers about the bank's financial products for the roads sector contractors

dfcu Bank recently held a customer engagement workshop with prospective customers in the roads construction sector in Uganda. The workshop which ran under the theme, ‘Challenges and Opportunities in the Road Construction Sector,’ was aimed at raising awareness on financing opportunities for various players in the road sector and highlighting the possibilities that arise from partnering with dfcu Bank in terms of increased capacity to take on bigger contracts. This was supported by the Uganda National Roads Authority (UNRA) which shared an outlook of the country’s road sector.

Speaking during the engagement, the dfcu Bank Executive Director and Chief Commercial Officer, William Sekabembe advised the contractors to consider partnerships when bidding for some of the local contracts as a means to building capacity and increasing their chances of winning contracts. “We would like to prepare our contractors for the big upcoming works that are coming through. We want to support the contractors right from the bidding stage, give them access to working capital and also facilitate their access to relevant equipment through leasing for the execution of their projects. The Bank has also set aside financing to support the local contractors who are bidding for the projects that are coming in. Ultimately, dfcu Bank’s value proposition for the road sector is to help the contractors to survive and grow during these times of crisis.”

One of the beneficiaries of dfcu Bank’s financing support, Mr. Francis Okello, the Director of Uganda Martyrs Housing and Construction Company Ltd shared his experience on being able to successfully carry out bidding and execution of his projects on account of dfcu’s support.

“Many of us contractors have been having operational challenges because we do not always cost appropriately for the bids and we end up cutting corners when we have been given contracts. Let us not be in a hurry to cost for jobs. Reach out to your finance relationship manager and discuss the best way you can cost for your job and successfully complete it. Once I was able to get a bid security without a cash cover because of the flexible relationship that I have managed to build with dfcu Bank,” Okello said.

Speaking on the availability of funding options, dfcu Bank’s Head Business Banking, Ronald Kasasa noted that the bank is aware of the challenges faced by road sector players, some of which include lack of collateral, poor record-keeping, lack of resources, unstable foreign exchange rates, long procurement processes, lack of access to markets, delayed payments with no compensation, competition from foreign companies, and it has come up with bespoke solutions.

“Understanding the challenges our different customers face is central to developing tailor-made solutions to support the different sectors. We understand that some of them still have major financing challenges on account of cost of credit, over trading, lack of collateral, bargaining power of suppliers and competition from foreign companies among other things. The turnaround time for a bid guarantee is long for most of the contractors to get financing from the banks. dfcu Bank is constantly refining its trade finance customer value proposition to support local contractors,” said Kasasa.

Some of the products include Unsecured products such as bid guarantees of up to UGX 500,000,000, contract financing of up UGX 100,000,000 for the contractor to start on the job, and invoice discounting of up to UGX 200,000,000. The unfunded products include invoice or certificate discounting, contract financing and asset financing while the bouquet of unfunded products includes Performance guarantees, Letters of Credit, Advance payment guarantees, Retention guarantees, and Supplier guarantees.

Eng. Joseph Otim, the UNRA Director Road Maintenance appreciated the customer engagement and commended dfcu Bank for the effort made in supporting local contractors. “I would like to thank dfcu Bank for realizing the importance of UNRA to dfcu. The issue of customer engagement is quite important and one of UNRA’s core values is to be customer centric. If you don’t hear from the contractors, it means there is something wrong. You must get feedback to know how you’re performing. There are available opportunities in UNRA – we have tried to look for deliberate ways of developing and bringing up local contractors. We now have a directive where there is a certain value of contracts that should be only contracted to local contractors.”

dfcu Bank continues to hold similar engagements with its customers in different sectors of the economy. Previously, it held similar sessions with customers in the NGO and Power sectors and has another planned for its customers in the Oil & Gas sector.