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Government to Regulate Loans Lending Business

Government is initiating measures it hopes will address the discord in the money lending business in the country.

David Bahati, the State Minister for planning told parliament that on top of drafting guiding regulations, the Uganda Microfinance Regulatory Authority (UMRA) has been tasked to establish channels to handle complaints.

About a week ago, Agago woman MP Judith Franca Akello complained to parliament about the fraudulent manner in which Bayport and Platinum Credit companies were disbursing and extracting loans from civil servants.

A UMRA report into this matter, showed that in some cases these two companies continued deducting money off their clients accounts even after loan completion.

According to minister Bahati, among other regulations coming, pay roll lenders who fail to divulge loan terms will be strictly reprimanded by UMRA.

UMRA has warned licensed money lenders that the Authority shall take action against institutions that continue with unfair lending practices such as non-disclosure of vital information to borrowers in loan agreements” said the minister.

Currently, the minister says the Authority working with Uganda Police Force are investigating loan agreements whose signatures purport to have been forged.

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