Bank of Uganda (BOU) revoked Friday the license of EFC Uganda Limited and placed the Microfinance institution under liquidation therefore issuing an order for them to close up shop.
Under section 72 (1) and section 12 (1) (d) of the Microfinance Deposit-taking Institutions Act of 2003 and it’s 2023 amendment, the Central Bank is mandated to liquidate and order the winding up of affairs of an institution upon determination that it is unable to execute its obligations.
BOU said in a statement signed by the Deputy Governor, Micheal Antingi-Ego that the closure is “due to the institution’s failure to resolve it’s significant under capitalization and poor corporate governance.”
The central bank said depositors will be informed by the Deposit Protection Fund of Uganda about “the arrangements that will be put in place to enable them to access all of their deposits.”
“All other creditors are requested to submit their claims to the Office of the Director Financial Stability, Bank of Uganda within 30 days from the date of this statement.” the statement reads in part.
“Any person possessing property of EFC Uganda Limited should deliver it to Bank of Ugandaand hand it over to the Office of the Director, Financial Stability.”
BOU said all EFC Uganda Limited borrowers must continue to service their loan obligations through payments to Bank of Uganda offices and branches.
About EFC Uganda Limited
EFC Uganda Limited (EFCUL), formerly Entrepreneurs Financial Center Limited, commenced operations in June 2012, focusing on microfinance for small enterprises. In November 2014, it secured an MDI banking license from the Bank of Uganda, rebranding as EFC Uganda Limited. As of December 2021, EFCUL held assets valued at Shs112.8 billion, boasting shareholders’ equity of Shs12.982 billion and a workforce of 136.
Shareholders, including Developpement International Desjardins (DID), AfricInvest Financial Sector Limited (AFS), BIO, and Uganda Gatsby Trust, contribute to the institution’s success.