Government Contract Advance Payments
For government-awarded construction contracts, mobilisation advances are typically available: UNRA contracts provide 20 to 25% advance payment against an advance payment bond; KCCA contracts typically 15 to 20%. The advance is recovered from interim payment certificates over the life of the contract.
Bank Financing for Construction Contractors Uganda
Key Banks for Construction Financing
- Stanbic Bank Uganda: Strong construction and project finance team
- dfcu Bank: Active in SME construction financing
- Centenary Bank: Accessible to smaller contractors
- Absa Uganda: Infrastructure and project finance capability
- Bank of Africa Uganda: Regional bank with construction portfolio
Interest rates on construction financing in Uganda: 18 to 24% per annum in Uganda shillings. Collateral required — land title, business assets, or personal guarantee from directors.
Development Finance Institutions
- Uganda Development Bank (UDB): Government-owned DFI providing lower-cost long-term financing for infrastructure and manufacturing — rates below commercial banks
- EADB: East African Development Bank financing major infrastructure projects
Performance Bonds and Bank Guarantees
| Bond Type | Typical Amount |
|---|---|
| Bid security / tender bond | 2% of bid value |
| Performance bond | 10% of contract value |
| Advance payment guarantee | Equals advance received |
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