Rachel Vanesa N. Muhwezi the Manager Microfinance Institutions, Uganda Microfinance Regulatory Authority says that small lenders play a big role in bringing numerous benefits and access to business opportunities and innovative technology-driven products and services especially instant loans without security.
The Microfinance Regulatory Authority-UMRA has asked financial institutions to provide fast and unsecured loans to individuals affected by the Covid-19 lockdown.
The outbreak of the pandemic and the ensuing lockdown of movement
and operations led to a drop in both
the demand and supply of goods and services. In turn, this has negatively
affected the revenues of businesses and individuals and their ability to
service their loans.
Rachel Vanesa N. Muhwezi the Manager Microfinance Institutions, Uganda
Microfinance Regulatory Authority says that several businesses were hit hard by the lockdown caused by the pandemic and are yet to recover.
Muhwezi was speaking at the launch of UNIFI, a new South
African microfinance company.
She says that small lenders play a big role in bringing numerous benefits and
access to business opportunities and
services especially instant loans without security.
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Unifi currently operates in South Africa, Zambia and Tanzania.
So far there are 950 institutions giving loans to Ugandans. The
institution has introduced instant and online unsecured loans to the Ugandan
market to support individuals affected by COVID-19.
The unsecured loans focus on salaried employed in both Government
and private sector and the key aims are to rid the rigorous process of the loan
The facility has unveiled its online loan access platform where clients
complete the loan application process online and these are for emergencies like
sudden illness and when an appliance or vehicle breaks down and needs to be
fixed at a cost.
Michael Boden, the Country Manager Unifi, says that they intend to
have a fast, and easy application online and physically in as quick as 20
minutes and flexible repayment with an affordable interest rate of 16 per cent
for first-time borrowers and as low as 8 per cent for clients with good credit
history per year.
He says they hope to change the future of credit in Uganda, by cutting
down on the long process and queues associated with getting loans.
The loan facility is intended to help Ugandans struggling during
the COVID-19 access credit, but also for workers to get advances and complete
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Several Ugandans have been affected by the COVID-19 lockdown
measures and have relied on support from microfinance institutions and banks
among others to rescue their business.