Bank of Uganda to Regulate Mortgage Refinancing Institutions with New Bill

The Bank of Uganda will regulate mortgage refinancing institutions through the Mortgage Refinance Institutions Bill, 2025, which mandates licensing, aims to facilitate long-term lending, and enhances accessibility to affordable mortgages, ultimately supporting housing development in Uganda.

The Bank of Uganda (BOU) is poised to regulate mortgage refinancing institutions upon the passage of the Mortgage Refinance Institutions Bill, 2025. This legislation empowers the Central Bank to evaluate applications for Islamic mortgage refinance operations. Specifically, it states, “A person shall not conduct a mortgage refinance business in Uganda without a licence or an approval in the case of Islamic mortgage refinance business issued by the Central Bank in accordance with this Act.”

The Bill was introduced by the Honorable Martin Mugarra, Minister of State for Tourism, Wildlife and Antiquities, during a plenary session on March 12, 2025. He emphasized the current lack of legal frameworks governing mortgage refinancing institutions, stating that these entities are critical to providing liquidity to financial institutions, enabling them to issue long-term mortgages.

In summary, the Mortgage Refinance Institutions Bill, 2025 represents a significant initiative by the Bank of Uganda to enhance the mortgage sector’s operational structure. By regulating the refinance institutions, the Bill aims to provide long-term funding solutions, improve mortgage accessibility, and support affordable housing initiatives across Uganda. Furthermore, the strict measures against non-compliance underscore the government’s commitment to maintaining a robust financial framework.

Original Source: www.zawya.com