MTN Uganda has reported a dramatic increase in mobile money loans, with disbursements rising from an average of Shs400 billion to Shs1.4 trillion over the 12 months ending December 2024. This growth, fueled by over five million subscribers seeking short-term credit, marks a significant milestone in the country’s financial landscape.
During the year, MTN disbursed more than 34 million micro-loans, a sharp four-fold rise compared to 2022. The surge underscores the growing demand for quick, accessible loans among Uganda’s low-profile borrowers, particularly in a country where traditional credit access remains a challenge.
The company operates its lending services through its mobile money subsidiary, which was restructured under the National Payment Systems Act 2020 to separate financial services from its telecommunications operations. In just two years, MTN’s micro-lending portfolio has grown by more than 33 percent, and projections indicate further expansion, driven by an evolving suite of financial products.
Speaking to the media, Mr. Richard Yego, Managing Director of MTN Mobile Money, attributed the growth to the introduction of four new loan products in late 2023 and early 2024. These offerings have catered to diverse borrowing needs, contributing to the company’s remarkable performance.
“Our micro-loan disbursements have grown from an average of Shs400 billion in 2022 to Shs1.4 trillion this year,” Mr. Yego said.
The average loan size during the period was approximately Shs42,000, with the majority of borrowers applying for amounts between Shs10,000 and Shs30,000. Interest rates vary depending on the loan type, ranging from 0.33 percent per day to 9 percent per month.
Mobile money loans have short repayment periods, typically lasting between one week and a month, with automated recovery mechanisms ensuring a low default rate. This reliability has bolstered their appeal, especially among Uganda’s growing pool of mobile money users.
The Ministry of Finance estimates that mobile money micro-loans now average Shs33 billion per month, spurred by the expansion of the financial technology sector. With 42 companies licensed as payment service providers and system operators under the National Payment Systems Act, fintech innovations have facilitated wider credit access.
Partnerships between mobile money platforms, fintech companies, and financial institutions have further broadened loan offerings, creating opportunities to tap into small and medium enterprise financing. MTN had earlier revealed plans to diversify its loan products, including merchant code-supported business loans aimed at SMEs. However, details about the implementation of these business-related loans remain unclear.
In addition to loan growth, MTN has seen its active mobile money subscriber base increase from 9.5 million to 13.5 million in 2024. The number of active mobile money pay merchant codes also surged from 50,000 to 400,000.
After a pause in agent recruitment in 2022 and 2023 to focus on quality and profitability, MTN resumed its acquisition drive in 2024, adding 60,000 new agents. This expansion brought the total number of active agents to 230,000, further strengthening its financial ecosystem.
MTN’s micro-lending boom reflects the transformative role of mobile money in driving financial inclusion and meeting the evolving needs of Uganda’s borrowers.
