The Bank of Uganda (BOU) effective today, January 19, 2024, placed EFC Uganda Limited under liquidation, revoked its license, and ordered the winding up of its affairs.
According to Micheal Antingi-Ego the Deputy Governor of the Bank of Uganda, this action has been taken because the Bank of Uganda has determined that the continuation of EFC Uganda Limited’s activities is detrimental to the interests of its depositors due to the institution’s failure to resolve its significant undercapitalization and poor corporate governance.
He said that the management of the Bank of Uganda will provide more details on how the customers will be able to receive their deposits.
“The Bank of Uganda and the Deposit Protection Fund of Uganda will inform depositors of the arrangements that will be put in place to enable them to access all of their deposits”, Antingi-Ego said.
He added that all other creditors are requested to submit their claims to the Office of the Director of Financial Stability, Bank of Uganda within 30 days from Friday, January 19, 2024.
He however revealed that all borrowers of EFC Uganda Limited must continue to service their loan obligations by making payments at Bank of Uganda offices and branches.
The governor also said that any person possessing the property of EFC Uganda Limited should deliver it to the Bank of Uganda and hand it over to the Office of the Director, Financial stability
“By Section 69 of the Act no steps may be taken by any person to enforce any security over the property of EFC Uganda Limited (MDI) and no other proceedings or execution of legal process may be commenced or continued against the institution or its property”, Atingi-Ego said.
He added that the action is an exercise of the Central bank’s powers under Sections 72 (1) and 12 (1) (d) & (g) of the Microfinance Deposit-taking Institutions (MDI) Act, 2003 as amended.
EFC Uganda Limited is a microfinance deposit-taking institution that has been lending to small businesses