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The government has ordered tighter regulation of high-interest loans, commonly known as predatory loans, to protect citizens and ensure access to fair and productive credit.
Deputy Minister of Finance, Laurent Deogratius Luswetula (MP), issued the directive while responding to a parliamentary question from Special Seats MP, Dr. Neema Peter Majule, who asked what measures have been taken against individuals or institutions benefiting from excessive loan interest rates that undermine economic empowerment, particularly for women and youth.
Luswetula said the government has already begun taking action, including revoking licenses of violators and enforcing legal measures.
“The Ministry of Finance is committed to ensuring that all lending institutions comply with regulations. We have also drafted rules for digital loans, expected to be implemented in the 2026/2027 financial year,” he said.
He emphasized that loans must only be issued by licensed institutions under the Banking and Financial Institutions Act, 2006, and the Microfinance Services Act, 2018.
So far, 69 unlicensed digital lending platforms have been suspended, and 126 others closed. Guidelines have also been issued to ensure transparency, ethical operations, full disclosure of loan costs, and protection of borrowers.
The Deputy Minister highlighted the government’s financial literacy programs from 2020/2021 to 2025/2026, which educate citizens on managing income, expenditures, and making informed financial decisions.
“Since 2021, National Financial Services Week has been celebrated annually across the country to raise awareness and build financial knowledge,” he said.
The initiative has reached 16 regions, benefiting more than 64,000 citizens, including 40,000 women and 24,000 men, across 94 councils.
The government continues to prioritize both financial education and responsible lending as key tools for economic empowerment.