Bicycle Credit Scheme

Until today, the majority of the Ugandan people lives off subsistence farming. As there are no seasons near the equator and, consequently, people can earn their food crops during the whole year, the culture of savings and precautions is not anchored in the Ugandan society.

FABIO therefore helps their beneficiaries with saving money for their own bicycle.

The bicycle is often a key tool for low income earners in rural areas to change from subsistence to marked oriented farming because it gives access to markets to both sell agricultural products and buy fertilizers, tools etc. to increase efficiency of farming.

But bicycles are not only distributed in rural areas: FABIO also gives bicycles on credit to employees mostly in Jinja and Iganga. Normally, the rates are centrally taken from the salaries by the employers and transferred to FABIO. This mechanism leads to very high repayment rates.

In case beneficiaries can not afford the full price of the bicycle, FABIO offers a sponsorship depending on the particular financial situation of the beneficiaries.

In partnership with Cycling out of Poverty – Netherlands and Interface for Cycling Expertise (ICE) FABIO has enabled more than 520 people from Jinja, Iganga and Katakwi district to benefit from the Bicycle Credit Scheme and the Subsidized Credit and Sponsorship.

Traditionally, women make up for over 80 percent of the Ugandan food crop production whereas they lag behind in terms of economic welfare. Moreover, they live isolated from each other under the patriarchy of their husbands. Therefore, 95 percent of the beneficiaries under the subsidized Bicycle Credit Scheme are deliberately women.

FABIO has found out that women with bicycles profit in terms of both economic welfare and their social role which is closely related to increasing self confidence.

The Bicycle Credit Scheme is a good example for sustainable development aid because, basing of the idea of microfinance that is combined with the aim of promoting non-motorized transport, money that has been received through fund raising once can be reinvested into the Bicycle Credit Scheme after it has increased the beneficiaries’ quality of life. Consequently, this program is nearly independent (donations are necessary for administration of the Bicycle Credit Scheme) from regular donations.