Microfinance Regulatory Authority issues notice to Mushrooming illegal Money lenders

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Microfinance Regulatory Authority says illegal money lenders are cheating people affected by COVID-19; Courtesy Photo

The Uganda Microfinance Regulatory Authority (UMRA) has said it is set to launch crackdown operations against unlicensed money lenders around the country, who have allegedly exploited the COVID-19 pandemic to cheat Ugandans of their hard-earned money.

According to UMRA Executive Director, Peter Emong Ojulang, the authority is concerned over mushrooming unlicensed money lenders who are taking advantage of desperate people affected by the COVID-19 pandemic to cheat them.

Mr Emong says, the operations of such individuals are in total disregard of provisions of the law including Section 84 of the Tier 4 Microfinance Institutions and Money Lenders Act, 2016 which prohibits anyone from conducting money lending business without a license.

“The Authority would like to inform the general public that Tier 4 Microfinance Institutions Act, 2016 is now effective…. We are informing the public that the authority has finalized plans to launch enforcement operations against all those operations outside the law” Mr Emong warned in the statement issued on Monday.

Established by Section 6 of the Act, UMRA ia mandated to regulate, license and supervise all the Tier IV Microfinance Institutions and Money lenders in Uganda. The Act applies to Money lenders, SACCOs, Non Deposit taking Microfinance Institutions and Self Help groups.

UMRA encourages borrowers to transact business with only licensed money lenders to avoid being cheated.

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