The Uganda Microfinance Regulatory Authority (UMRA) has issued a notice to all licensed digital credit providers, expressing concern over reports that some of these providers might be engaging in harmful practices. The notice, referenced as UMRA/ADM/01/31/05/2024 and dated May 31, 2024, highlighted issues such as publishing false, misleading, or deceptive information, as well as unethical loan collection practices and harassment of borrowers.
UMRA directed all digital credit providers to immediately stop these harmful practices. The regulatory authority emphasized the importance of complying with the Digital Lending Guidelines V01.1 (2024) and other relevant laws and regulations. They reminded the providers that adherence to these guidelines is crucial for maintaining ethical standards in the lending industry.
UMRA warned that they would take necessary administrative actions against any licensed institutions that fail to comply with the Tier 4 Microfinance Institutions and Moneylenders Act, 2016, the Regulations of 2018, the Digital Lending Guidelines of 2024, and the Financial Consumer Protection Guidelines of 2019. These measures are aimed at protecting consumers and ensuring fair practices in the financial sector.
Edith N. Tusii-Cibira, the Executive Director of UMRA, signed the notice, underscoring the urgency and importance of this directive. The directive is effective immediately and applies to all licensed digital credit providers under UMRA’s jurisdiction. Copies of the notice were distributed to relevant stakeholders to ensure widespread awareness and compliance.
The UMRA office is located at Rwenzori Towers, Plot 6 Nakasero Road, Kampala, Uganda. They have provided contact information, including a toll-free number, for any inquiries or reports related to this directive.
