

31 October 2024, 5:31 pm
By Otim Moses Arapmoi
Moneylenders in Kitgum district have been ordered to immediately stop holding their clients’ National ID cards as collateral or face legal consequences. The moneylenders include microfinance institutions as well as SACCOs.
The warning was issued last week by Kitgum district security officials during a meeting with the moneylenders in the RDC’s boardroom.
In their defence, the moneylenders argued that some borrowers lack property to present as collateral, leaving National ID cards as the only valuable items they possess.
They stated that after the president issued a directive against the confiscation of National IDs as collateral, they have since returned the IDs to their rightful owners. However, they revealed that some clients have not collected their IDs despite several calls for them to do so.
ASP Peter Owesigye, the Kitgum District Police Commander, noted that some moneylenders are operating illegally, which he says will hinder them in recovering funds from their defiant clients.
He urged the moneylenders to collect only legally acceptable items as collateral and not National IDs or other sensitive documents.
The Deputy RDC for Kitgum, Haji Waliri Marijan, urged the moneylenders to register with the Uganda Microfinance Regulatory Authority to ensure they operate within the laws of the land. He also encouraged them to establish offices for easier access and visibility.