Ecobank Uganda has launched the Electronic Merchant Cash Advance (eMCA), a fully digital lending solution that provides eligible merchants with collateral-free working capital of up to Shs70 million based on their payment collections.
The bank says eMCA is the first merchant cash advance of its kind in Uganda and represents a shift towards using a business’s transaction history, rather than physical assets, as a basis for accessing working capital.
Eligible merchants collecting payments through Ecobank’s Point-of-Sale (POS) terminals, web, and Quick Response (QR) channels can apply digitally after building a minimum three-month transaction history. An automated credit engine analyses the merchant’s transaction history and assigns a credit limit of up to 50 per cent of average monthly digital collections.
Once approved, funds are disbursed to the merchant’s account following digital acceptance and one-time-password confirmation. Repayment is made through a single settlement within 30 days, with the amount automatically deducted from the merchant’s collection flows. The facility requires no collateral, paperwork, or branch visit.
Ecobank said the solution is designed to address one of the persistent challenges facing Ugandan businesses: access to short-term working capital. Businesses can have strong sales and growing demand but still struggle to restock, pay suppliers, or take advantage of new opportunities because of the timing gap between making sales and receiving funds.
The issue was also raised by business owners during Ecobank Uganda’s SME Breakfast, where participants highlighted the difficulties associated with delays in accessing working capital.
Uganda’s Tenfold Growth Strategy aims to expand the economy from about $50 billion to $500 billion by 2040, with the private sector, including small and medium-sized enterprises, expected to play a significant role. Small businesses account for a large share of enterprises and employment in Uganda but often face challenges accessing conventional credit because of collateral requirements.
Speaking at the launch, Grace Muliisa, Managing Director of Ecobank Uganda, said the product was designed to support businesses that may not have conventional assets to pledge as security.
“Uganda has set itself the ambition of growing its economy tenfold by 2040, and no economy grows tenfold on the back of large corporates alone. It grows when the supermarket in Kabalagala, the hotel in Jinja and the clinic in Mbarara can all finance their next order without pledging a land title,” Muliisa said.
She said eMCA would allow businesses to convert their existing commercial activity into access to credit. “It takes the everyday commerce Ugandan businesses already generate and turns it into credit, at speed and at scale. When capital moves faster through the real economy, inventory turns faster, suppliers are paid on time, jobs are created and tax revenue grows,” she said.
Emmanuel Kikoni, Head of Cash Management at Ecobank Uganda, said the product changes the basis on which merchants can access financing.
“For decades, the question a Ugandan business heard from its bank was what do you own. eMCA replaces that with a better question: what do you sell,” Kikoni said.
He said the bank’s automated system can assess a merchant’s transaction activity and make a credit decision within minutes, with repayments linked to the same collection flows used to determine the facility. “That is a genuinely new operating model for lending in this market. It has been tested end to end with Ugandan merchants, and it runs on the same digital collections and cash management rails our clients already use every day,” he said.
The initial rollout will target merchants in retail, hospitality, food and beverage, fuel, healthcare, and leisure—sectors characterised by relatively high transaction volumes and regular cash flows.
Evans Katwebaze, Head of SME and Value Chain at Ecobank Uganda, said the product was developed in response to concerns raised by business owners about short-term financing needs. “At our SME Breakfast, business owners told us plainly that the difference between growing and standing still is often a few days and a few million shillings,” Katwebaze said.
He said eMCA carries a three per cent access fee, provides financing of up to 50 per cent of a merchant’s average monthly collections, and is repaid through settlement flows.
The bank said the facility also encourages businesses to formalise and channel more of their sales through digital payment systems, making their commercial performance more visible. Ecobank Uganda said the solution will initially be available to established merchants using its collection channels, with plans to progressively extend it to newly onboarded businesses in priority sectors as the bank expands its digital acquiring network.
