Uganda’s Financial Watchdog Issues Guidance on Anti-Money Laundering Laws for Microfinance Institutions

The Uganda Microfinance Regulatory Authority (UMRA) has released a guidance note aimed at clarifying the anti-money laundering and combating the financing of terrorism (AML/CFT) requirements for tier 4 microfinance institutions in the country. This move is intended to ensure that these financial institutions are aware of their legal obligations under the Anti-Money Laundering Act, 2013.

What is an Accountable Person?

According to the Anti-Money Laundering Act (AMLA), accountable persons refer to those who conduct businesses such as:

• Consumer credit
• Mortgage credit
• Factoring with or without recourse
• Finance of commercial transactions

These individuals and entities have a duty to prevent and detect money laundering and the financing of terrorism.

Guidance for Tier 4 Microfinance Institutions

The guidance note requires tier 4 microfinance institutions to implement measures to deter and detect money laundering and terrorist financing activities. The document provides an interpretation of the AMLA and related regulations, as well as explanations of common situations that may arise under these laws.

Purpose of the Guidance Note

The UMRA stressed that the guidance note is not intended to provide legal advice, but rather serves as general information on AML/CFT requirements. However, it is expected to provide clarity and help microfinance institutions in Uganda comply with the country’s anti-money laundering regulations.

Access the Full Guidance Document

The full guidance document can be accessed online for more details.

By following this guidance, tier 4 microfinance institutions in Uganda will be better equipped to prevent and detect money laundering and terrorist financing activities, ensuring a safer and more transparent financial system.