Loan Pressure Forces Market Vendors Out of Business in Pader

The Pader Market Vendors’ Cooperative Society, once a thriving hub of small-scale entrepreneurship with over 308 registered members, is now struggling with a sharp decline in active vendors. 

According to Ms. Nighty Akello, Chairperson of the cooperative, several members have been forced to abandon their businesses due to overwhelming loan obligations.Ms. Akello shared that many cooperative members, in a desperate bid to secure startup capital, resorted to borrowing from private money lenders at high interest rates. 

As a result, instead of reinvesting profits back into their businesses, most members are now using their income to repay loans—leaving little to no capital for growth or sustainability.

“Some members have not only closed their businesses but have also fled the district altogether,” Ms. Akello explained. “The pressure from lenders is just too much, and it’s hurting the cooperative’s potential to thrive.”

She added that the current financial strain is stifling market development and discouraging entrepreneurship among women and youth in the district—demographics that the cooperative was initially formed to empower.

The issue came to light more prominently during a clean cooking awareness campaign organized by Lagara Investments Company Limited, where community concerns extended beyond energy use and into broader challenges facing local livelihoods.

Speaking at the event, Mr. Raymond Olyel, Director of Lagara Investments, urged small business owners to reconsider their borrowing strategies. He emphasized the dangers of relying on private lenders and encouraged vendors to instead explore government-supported funding programs, such as the Parish Development Model (PDM).

“Access to capital is important, but how and where we get it matters. We must shift our focus to government funding opportunities that are more flexible and less predatory,” Mr. Olyel advised.

He further highlighted that the Parish Development Model, launched by the Government of Uganda, offers community-based, low-interest financing aimed at lifting people out of poverty and building sustainable local economies.

Lagara Investments Company Limited continues to advocate for financial literacy, responsible borrowing, and sustainable entrepreneurship as core pillars of rural economic transformation. Through its outreach programs, the company seeks not only to promote climate-smart practices but also to support the long-term financial well-being of the communities it serves.