Ugandan Banks Deny Loans to Over 100 MPs Amid Election Petition Uncertainty

By Skika Reporter

Commercial banks in Uganda have reportedly restricted access to loans for more than 100 Members of Parliament, including several ministers, whose election victories are being challenged in court following the recently concluded general elections.

According to reports, financial institutions have adopted a cautious approach toward lawmakers facing election petitions, citing concerns about potential losses should courts overturn their victories.

A banking source quoted by local media said that lenders have effectively blacklisted affected legislators from obtaining credit facilities until the legal disputes surrounding their elections are resolved.

“Banks have blacklisted at least 100 MPs, including ministers, barring them from accessing loan facilities until election petitions challenging their victories have been resolved by the courts,” the source reportedly said.

The decision stems from experiences in previous parliamentary terms, where newly elected MPs secured substantial loans shortly after assuming office, using their anticipated parliamentary salaries and benefits as collateral. In several cases, successful election petitions led to the nullification of their victories, leaving banks struggling to recover outstanding debts.

Financial institutions say many legislators seek large mortgages, vehicle financing, and business loans based on the expectation of serving a full five-year parliamentary term.

“These members come with big appetites. They want mortgages, car loans, business capital all based on a five-year term. When the petition succeeds and the court nullifies their election, banks are left holding the debt,” the source explained. “The member is out of Parliament, stripped of their salary and perks, and they simply disappear. Recovering those funds becomes an extremely difficult and expensive process.”

As a result, several banks are reportedly withholding new credit facilities from lawmakers whose electoral victories remain under legal challenge.

A number of high-profile parliamentary races are currently before the courts.

Among them is the petition filed by Jet Tumwebaze challenging the election of Godfrey Aine Kaguta as Mawogola North MP. Health Minister-designate Dr. Chris Baryomunsi is also facing a legal challenge from Sam Kajjo Arinaitwe regarding the Kinkizi East parliamentary seat.

In Kampala Central, National Unity Platform (NUP) Secretary General David Lewis Lubongoya has petitioned the High Court seeking to overturn the election of Kampala Minister-designate Minsa Kabanda Nabbengo.

Elsewhere, NUP’s Gerreth Namugga has challenged the election of Mawogola South MP Dez Oswald Byuma, while former Defence Minister Vincent Ssempijja has petitioned the court against Kalungu East MP Yusuf Nkerentanyi, alleging electoral irregularities that affected the outcome of the race.

Alex Waiswa Mufumbiro, the detained deputy spokesperson of NUP, has also filed a petition contesting the election of Nakawa East MP Frederick Ruhindi, the former Deputy Attorney General. Mufumbiro alleges electoral fraud and is seeking the nullification of Ruhindi’s victory.

Former counter-terrorism police chief John Ndungutse Ngaruye has likewise challenged the election of Kinkizi West MP James Niringiyimana Rwogi Kaburuka.

Judiciary spokesperson James Ereemye recently outlined the legal process governing election petitions. He noted that proceedings begin with the filing of petitions, followed by the service of summons and responses from respondents.

According to Ereemye, petitioners have 15 days from the publication of election results in the Uganda Gazette to lodge their cases. Once the pleading stage is complete, statistics on all filed petitions will be compiled and submitted to the Principal Judge, Justice Frances Abodo, who will assign judicial officers to hear the matters.

The High Court is legally required to conclude election petition cases within six months after hearings commence.

The outcome of the petitions is expected to have significant implications not only for the composition of Parliament but also for the financial standing of affected legislators, many of whom may remain locked out of credit facilities until their legal battles are settled.