KAMPALA, Uganda — The number of registered borrowers in Uganda has climbed to more than 4 million as small-scale lenders and cooperatives move away from trust-based lending toward formal credit tracking.
New data from the Bank of Uganda’s 2025 annual supervision report shows the number of people with a formal credit history surged from 2.9 million to 4.1 million in a single year.
The increase is being driven by a significant shift in the financial sector, where Savings and Credit Cooperative Organizations, known as Saccos, and microfinance firms have overtaken commercial banks as the most frequent users of credit reference bureaus.
These smaller lenders now account for 41.4 percent of all credit reports requested, as they seek to protect their balance sheets from the risks of multiple borrowing in the informal economy.
While the expansion offers those with good repayment records easier access to finance, experts warn it is a double-edged sword. A default on a minor loan from a local Sacco or a digital lending app can now follow a borrower across the entire banking system, potentially leading to long-term financial exclusion.
The central bank noted that credit-related inquiries jumped by more than 28 percent over the period, while the number of accredited providers feeding information into the system grew from seven to 31. This group now includes digital and money lenders who operate at the heart of the country’s small-business economy.
The World Bank has previously cautioned that Uganda needs sustained growth to absorb its expanding labor force. However, with per capita income projected to grow at just 2 percent annually through 2027, the tightening of credit rules by small lenders may present new challenges for low-income traders.
To manage the rapid influx of data, the Bank of Uganda is establishing a central data hub to standardize records and ensure accuracy across the country’s three licensed bureaus.
