Wednesday, April 24, 2024

Uganda: A Moneylender Charging an Interest of 20% Per Month? Enough Is Enough, Says Museveni

President Museveni has directed the Ministry of Finance to issue a statutory instrument in two weeks on interest paid by borrowers to moneylenders in the country.

He said the statutory instrument should operationalize section 90 of tier 4 microfinance institutions and money lenders act 2016 .

Section 90 of the Tier 4 Microfinance Institutions and Moneylenders Act 2016 says a minister may in consultation with the authority by notice in the Gazette, prescribe a maximum interest rate which a money lender shall charge.

The same law says a money lender who charges an interest that is higher than the maximum interest rate prescribed by the minister commits an offence and on conviction, is liable to a fine not exceeding fifty currency points(shs1m) and the court may, in addition to the fine order that the money lenders licence be cancelled and the money lender pays the borrower any money paid in excess as a result of the interest rate charged.

Speaking on Thursday during the NRM Caucus meeting at State House in Entebbe, Museveni said moneylenders have caused misery to families and individuals to an extent of committing suicide due to the high and unregulated interest rates.

“These money lenders who are causing suicide to our young people, who allows them to operate? Because I wanted to cancel all the loans of the money lenders,” Museveni said.

The Attorney General Kiryowa Kiwanuka informed the President that money lenders are provided for by law and are licensed by the microfinance institutions which are managed by the Ministry of Finance.

“However, the Ministry of Finance was required under the law to make a provision for the maximum interest payable in this case which has not been done since 2016,” Kiryowa Kiwanuka said.

The furious Museveni said something must be done to stop the thieving moneylenders.

“Within two weeks, I now direct the Minister for finance to put out a statutory instrument on the interest paid to money lenders in accordance with the inflation which we shall all support. Why should somebody charge 20% per month,” he said.

The development comes on the backdrop of growing concerns by members of the public over losing their property to moneylenders.

The NRM Parliamentary caucus also resolved to support the president in parliament when amendments were introduced to strengthen the anti-corruption legal regime particularly to fight white collar extortion.

President Museveni who was accompanied by the first lady and NRM Chairperson for Ntungamo Janet Museveni urged members of parliament to fight corruption if they want to be appreciated by the people.

“I’m going to crush these corrupt people. When you hear bloodshed don’t get surprised. Because you are going to kill your country. So, I want you to support me If I bring with Attorney General an amendment saying that if anybody extorts money in the name of the president, should go to jail for some time. We are going to attack a few examples and they will become examples of others.”

The president also sought support from members to stop the act of fundraising especially in areas where homesteads do not have enough household income to contribute during fundraising drives.

“This kusonda (fundraising) should stop. The kusonda is not bad if the people have income. If people don’t have money the kusonda becomes extortion,” Museveni said.

The NRM Chairman also updated the caucus about Operation Shujaa to wipe out the ADF rebels that is yielding results every day.

The NRM parliamentary caucus congratulated the President Museveni and the First Lady who is also the Minister of Education and Sports and other East African leaders upon the successful bid to co-host the 2027 Africa Cup of Nations.

The NRM parliamentary caucus congratulated the president and the First Lady upon their 50 years marriage anniversary.

“You and Mama continue to be the national and regional models in upholding and preserving values and principles of the institutions of marriage and the broadly the family,” Hamson Obua, the Government Chief Whip in Parliament said.