DPF pays depositors of closed ECF Microfinance

Kampala, Uganda | THE INDEPENDENT |  The Deposit Protection Fund (DPF) has completed the payment of 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 a violation of capitalization and governance regulations.

The Financial Institutions Act 2004 as amended, protects deposits of up to 10 million shillings per depositor, which are supposed to be paid by the DPF. These amount to about 2 billion shillings.

BoU, as the statutory liquidator of EFC Uganda Limited, will pay the unprotected deposits, valued at about 50 billion shillings, with each holding more than 10 million.

BoU Director of Communication, Kenneth Egesa says they have seven days from Monday 5 to submit their personal information to the BoU Director of Financial Stability, to facilitate payment of their deposits.

The requirements include a letter confirming the account name in EFC, the names and signatures of the signatories, alternative Bank accounts registered in their name, National ID cards, and mobile phone numbers.

Companies are required to submit a Certificate of Incorporation and company location and the Memorandum and Articles of Association.

“Payment of unprotected deposits will be made with effect from February 19, 2024, after verification of the information submitted,” says Egesa, adding that all affected depositors will be paid in full.

Yusuf Mukiibi, the Director of Finance and Operations at the DPF says that of the 52 billion shillings deposits the EFC had, about 20 clients had deposits amounting to about 50 billion shillings, while the 98 percent of them are those with not more than 10 million shillings.

In effect, according to Mukiibi, the Bank of Uganda will deal with the 2 percent depositors, while DPF pays the 98 percent of the depositors who claim 2 billion.

According to DPF, those depositors who had 100,000 shillings or less and submitted accurate personal information, have been paid their money, while the rest of the protected individual depositors are currently being paid since Monday 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,” said DPF CEO Julian 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 explained that depositors who had credit facilities would be paid less than the outstanding loan amount.

As for companies and joint account holders with not more than 10 million shillings, Oyet says DPF is making arrangements to pay them starting February 12, next week.

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