By THE INDEPENDENT UG
Kampala, Uganda | THE INDEPENDENT | The Deposit Protection Fund (DPF) has successfully completed the payment process for individually protected depositors of the closed EFC Microfinance Uganda.
Last month, the Bank of Uganda placed EFC Uganda Limited under liquidation, revoked its license, and ordered the winding up of its affairs, citing violations of capitalization and governance regulations.
The Financial Institutions Act of 2004, as amended, protects deposits of up to 10 million shillings per depositor, and these are to be paid by the DPF. This amounts to approximately 2 billion shillings.
As the statutory liquidator of EFC Uganda Limited, the Bank of Uganda will handle the payment of unprotected deposits, valued at about 50 billion shillings, with each holding more than 10 million.
Kenneth Egesa, BoU Director of Communication, stated that affected depositors have seven days from Monday, February 5, to submit their personal information to the BoU Director of Financial Stability for the facilitation of deposit payments. The requirements include a letter confirming the account name in EFC, the names and signatures of signatories, alternative bank accounts registered in their name, National ID cards, and mobile phone numbers. Companies are required to submit a Certificate of Incorporation, company location, and the Memorandum and Articles of Association.
Egesa emphasized, “Payment of unprotected deposits will be made with effect from February 19, 2024, after verification of the information submitted.” He assured that all affected depositors would receive full payment.
Yusuf Mukiibi, Director of Finance and Operations at the DPF, disclosed that out of the 52 billion shillings in deposits held by EFC, approximately 98 percent are depositors with not more than 10 million shillings. The Bank of Uganda will address the 2 percent depositors, while the DPF will cover the 98 percent, amounting to 2 billion.
According to DPF CEO Julian Oyet, depositors with 100,000 shillings or less, who submitted accurate personal information, have already been paid. The remaining protected individual depositors are currently in the process of being paid since Monday, February 5.
“Individual account holders with deposits above 100,000 shillings up to 10 million shillings, and with verified National ID information, shall be paid their protected deposits through Stanbic Bank, Lugogo Branch with effect from Monday, February 05, 2024, during working hours,” explained Oyet. Depositors are required to present their valid original National Identity Cards and active mobile phone numbers at the Stanbic Lugogo branch.
BoU and DPF clarified that depositors who had credit facilities would receive an amount less than the outstanding loan amount. Regarding companies and joint account holders with not more than 10 million shillings, Oyet confirmed that DPF is making arrangements to pay them starting February 12, next week.
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