Ngora people warned against huge loans

NGORA - Do not obtain a huge loan that you will not be able to repay. That is the warning call from RDC Henry Ariong to the people of Ngora district.

His call comes against the backdrop of reports of men abandoning their families because of the burden of debt arising from multiple loans acquired.

According to Ariong, such heavy loans hurt the future of families especially when the family head fails to repay, which sometimes leads to loss of property like land.

So the message is clear: acquire a loan that you are confident you will be able to reimburse.

The RDC also blames microfinance institutions like Saccos and village saving groups for not explaining to their members/customers the terms and conditions of their loans.

He urges money lenders to be realistic to their customers and explain the Ts&Cs without withholding information.

Charles Ecaat, the LC3 chairman of Mukura sub-county in Ngora district says many people have access to loans, including those without enough collateral security.

But critically, he says many locals acquire loans to clear other debts, among other things.

"I blame financial institutions who give heavy loans to locals who even don't have enough collateral security," says Ecaat.

Meanwhile, Francis Opio, the LC1 chairman Orisai, Ajesa village in Kapir sub-county says in his area, loan officers have fallen short on sensitizing the people about loans.

"These lenders nowadays don't educate, inform and sensitize people. Instead they convince everyone in the village to get loanS from them."

But Martin Otira, a loan officer with Tujjenge Lending Institution - Soroti branch says they always educate their customers before giving them loans.

He says that after educating them, they go ahead to verify the collateral security to see whether it's worth the loan applied for by the customer.

"Customers also lie to us when borrowing money. They tell you that he wants a loan for a certain business but when given a loan, they use for other issues. That is the challenge we are also facing."