URSB, UMRA partner to ease credit access for MSMEs

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By Our Reporter 
The Uganda Registration Services Bureau (URSB) and Uganda Microfinance Regulatory Authority (UMRA) has signed a  memorandum of understanding to further ease access to finance for small businesses. 
 
According to Bemanya Twebaze, URSB registrar general: “This working partnership will help us promote the usage of our security interest in movable property registry (SIMPO) while enabling access to credit for business and personal growth through safer lending and easier borrowing.” 
 
The SIMPO Act came into force in 2019. This law helps micro, small and medium enterprises (MSMEs or individuals with limited credit to use their movable assets as collateral for loans. SIMPO was developed in fulfillment of the Government of Uganda’s objectives in the Second National Development Plan 2015/16 – 2019/20 of reducing interest rates, decreasing default rates and increasing the pool of new borrowers.
 
The purpose of the MoU is to establish a working relationship between the two government agencies in areas of financial data verification, easy sharing of business registration information, facilitating sharing of licensed business entities under UMRA among others. 
 
 
Edith Namugga Tusuubira, the executive director UMRA said the enactment of SIMPO Act 2019 and the introduction of electronic chattels securities registry at URSB establishes a legal and regulatory environment that facilitates the use of movable assets effectively as collateral by borrowers.
 
“This is a critical step towards responsible and inclusive access to finance,” she said. 
 
The tier 4 Microfinance Institution and Money Lenders Act 2016 establishes UMRA as an autonomous body with the mandate to regulate, license and supervise money lenders and tier 4 microfinance institutions such as SACCOs, non-deposit taking microfinance institutions among others. 
 
“I see a window of opportunity for tier 4 Microfinance Institutions and money lenders to be equipped with appropriate legal instruments, sufficient capacity and regulatory incentives,” she added. 
 

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