Uganda Police Warn Against Use of National ID Cards as Loan Collateral by Moneylenders
The Uganda Police has warned against the use of national identification cards as collateral by moneylenders in various regions, including Buwenge District, Busoga Region, Dokolo and Amolatar District in the Lango Sub-Region, and the Greater Kampala area. The Police emphasized that national IDs are only for identification and have no monetary value. They urged those whose IDs have been taken as collateral to report to the local police. The offenses and penalties under the Registration of Persons Act for unlawfully possessing or taking someone else’s national identification card. The Uganda Microfinance Regulatory Authority’s rules prohibit the use of national IDs, passports, or other identity documents, as well as bank savings, ATM cards, or security codes, as loan collateral.
The misuse of national identification cards as collateral is on the rise, particularly in the Buwenge District, Busoga Region, Dokolo and Amolatar District in the Lango Sub-Region, and the Greater Kampala area. As you are all aware, National IDs are only to be used for identification and have no economic or monetary worth. Because the owner is prevented from using their National ID as identification when traveling or making other transactions, any act of confiscation, removal, taking, or handing up a National ID as collateral is prohibited.
The misuse of national identification cards as collateral is on the rise, particularly in the Buwenge District, Busoga Region, Dokolo and Amolatar District in the Lango Sub-Region, and the Greater Kampala area. As you are all aware, National IDs are only to be used for identification and have no economic or monetary worth. Because the owner is prevented from using their National ID as identification when traveling or making other transactions, any act of confiscation, removal, taking, or handing up a National ID as collateral is prohibited.
Uganda Police requests that anyone whose National ID was taken or used as collateral contact the local police for additional help. Sections 77(b), (e), and (f) of the Registration of Persons Act define offenses as:
- unlawfully keeping or taking possession of a national identification card or alien’s identification card that belongs to another person;
- being in possession of more than one national identification card or alien’s identification card; and
- being in possession of more than one alien’s identification card, commits an offence and is liable on conviction to a fine not exceeding forty-eight (48) currency points or imprisonment not exceeding three years or both.
All loan providers should familiarize themselves with the Uganda Microfinance Regulatory Authority’s regulatory dos and don’ts. A National ID, passport, warrant card, or other document proving the owner’s identity or nationality, as well as bank savings, ATM cards, or the security codes for those cards, cannot be used as collateral for a loan, according to their rules.
