Central Bank reviews bank charges

 By Francis Kagolo

The Bank of Uganda has started investigating all commercial bank charges in order to assess their impact on bank customers and viability to the economy.

Charges that will be deemed as cheating bank customers and injurious to economic development will be scrapped.

 The development follows a directive issued by Ugandan president Yoweri Museveni last week to have all bank charges reviewed following a four-day traders’ strike in Kampala.

In one of the meeting held at State House, Nakasero on January 12 to resolve the strike, Museveni directed that the central bank, commercial banks, relevant government officials and the city traders’ association (KACITA) executive to collaborate to specifically review all commercial bank charges.    

The president observed that there appeared to be duplicity of bank charges, which are making life difficult for bank customers.

Bank of Uganda spokesperson Dr. Jan Tibamwenda said that the governor, Tumusiime Mutebile, initiated the review process immediately after the president’s directive.

“The situation is being handled,” Tibamwenda told New Vision on phone.  “The attitude of everybody is to study what the president directed and find out whether it will succeed.”

The central bank is probing the deposit, withdrawal, and loan processing charges and interest rates among others.

Although the seven-day ultimatum the president gave Mutebile to review the charges elapsed on Thursday, Tibamwenda said they were yet to finalize the process since the governor has been attending the NRM retreat in Kyankwanzi.

The traders closed their shops for four days last week demanding a reduction in interest rates charged by commercial banks, particularly on old loans.

The interest rates have increased from about 20% to nearly 30% in just three months following an increase in the central bank rate (CBR).