In March 2019, the Moneylenders Association of Uganda Ltd, MK Creditors Ltd and the Moneylenders Union Ltd secured a court order against the Attorney General and UMRA against capping interest rates, and they say it still stands.
The Deputy Governor says that their activities as well as other changes that have the economy safer going forward, they have decided to reduce the rate, though cautiously.
Similarly, the value of loan applications rose to 4.9 trillion Shillings in the quarter to October from 3.7 trillion Shillings in the quarter to July 2021. This improvement in the demand and supply reflects improved economic activity following the easing of the lockdown towards the end of the year, with both having declined in the earlier part of the year.
At the onset of the pandemic in Uganda last year, the local authorities had no idea that the pandemic would last far longer than a few weeks. For this, the banking industry with guidance by the Central Bank offered credit relief measures for 10-months to borrowers to cushion them against any possible shocks, since economic activities had been shut down.
