Well, it`s not cheap. You will need start-up capital, office/equipment money, registration fees, licenses, and other fees. Don`t just sit on your idea. Make money with it, gather enough information and dive into the money lending business. A streamlined and structured money lending practice will undoubtedly create a safer and more conducive environment for lenders to do their jobs and for borrowers to obtain loans. However, given that money loans are designed to provide affordable credit to the low-income segment of the population as an alternative to traditional institutional loans, it is crucial that the government strike the right balance between creating a safe and conducive environment for lending money and combating unscrupulous and unscrupulous money lending practices. Excessive regulation could be defeatist, as it could potentially increase the cost of loans, make the business uncompetitive, and incentivize lenders not to comply. 1. Company name – this is the one that will sell your business, this is also what people will look for if they want a loan. The time has come, why? Because money is never enough, you never know when emergencies may occur.

Well, there is also a risk-free software management system that can help you manage your loans. Venturing into a money lending business is a good idea, especially since people need money these days. You need to focus on a small market if you want to be competitive. It`s best to start small. Now that you`ve started the business, how do you keep records? How do you know who and what they owe you? Introduction of Jisort: Regulations require lenders to keep a physical address and keep records of their business for a period of 10 years. This is the same period required by financial institutions under the Money Laundering Act. In addition, lenders are required to post interest rates at all times in a conspicuous place on their premises and to maintain appropriate books of accounts, including a register of securities and debtors. This will increase transparency in business and foster trust in lenders.

The regulation requires UMRA to assess the relevance and relevance of the management and board of directors of a lender and any person who will be employed by or associated with the lender. This is similar to the aptitude and compliance test conducted within the board of directors and management of a financial institution. While the criteria for lenders are likely much less strict, it`s reassuring to know that lenders` management and board of directors will be scrutinized to ensure the business is not being carried on by undesirable individuals. In addition, any change to the board of directors or any other direction of a lender must be approved by UMRA after the proposed candidate has been similarly assessed by UMRA. A money loan company is a type of business that is becoming more and more popular nowadays. This is because people are now affected by the economic crisis. Money loan companies usually offer people the opportunity to get loans in a variety of ways, whether through the use of credit cards, personal loans, and other types. The market for money lending companies is already saturated with big banks, tycoons and other companies that have enough money to lend to people in need.

If you`re thinking about starting your own money lending business, but you`re worried that it won`t work, you`ll probably want to take the risk. There are money loan companies that focus on the small market that offers money through cashing checks, payday advances, loans, and other lending services. Remember, when starting this type of business, it would be better to start small. 6. Terms and Conditions – Every business needs the codes and laws on how it operates. Since the business is yours, you can decide how much you charge to repay the loans and what collateral you get if you don`t pay. 2. Business strategy – your plans, as well as your prices, terms and conditions and everything you need for your business. UMRA is also required to maintain a register of all lenders, which can be consulted by members of the public for a fee. Starting this type of business requires a lot of effort and money. There are good and bad ways to lend money. Proper documentation is essential in your business to track the flow of money.

It should be a well-written type of documentation. The help of a lawyer will make this task much easier. Draft the contract carefully and discuss it in depth with your lawyers. This way, you can prevent customers from finding flaws in your contract. The regulation aims to curb the hitherto unorthodox practice of money lenders withholding important documents from the borrower to guarantee repayment and essentially holding the borrower hostage. The regulation stipulates that a lender cannot require the following documents as collateral for advanced money: ID cards or passports, ATM cards or security codes for ATM cards or custodian account books, or an instrument for transferring goods or assets signed before the loan is disbursed. The borrower is also not exposed to the risk of a lender losing his records. In addition, if a money lending transaction is disguised as a sale or transfer of ownership, such a transaction may be declared invalid by the court and may result in the revocation of the lender`s license. Start with the typical ”secured loan” product, where borrowers must give you the security of an asset worth more than the loan amount. I would suggest lending nothing more than 50% of the value of the security. In 2016, Uganda reformed its laws by passing the Level 4 Microfinance Institutions and Money Lenders Act 2016 (the Act). The purpose of the law was to legitimize and strengthen trust in microfinance institutions (SACCOS, support groups, non-depositaries and community microfinance institutions) and money lenders that had long remained off a regulator`s radar.

.