The National Identification and Registration Authority (NIRA) has warned the general public against using National IDs as security for loans.
The Authority says section 69 of the Registration of Persons Act, 2015, states that an issued National Identification card remains the property of the government.
According to the directorate of legal and board affairs at NIRA, national identification cardholders should desist from using their national IDs to obtain loans as these are issued documents by the government that serve as proof of identity and citizenship.
“Money lenders who have been retaining National Identification Cards as security for loans issued out to individuals are also advised to stop such illegal practices that violate the rights of the cardholders,” said the directorate of legal affairs at NIRA.
NIRA has therefore encouraged the general public to report to any nearest NIRA office in case any person has retained their national identification cards.
In April this year, police and its sister security agencies got concerned about the increased misuse of National IDs as collateral. Police said was most common in the districts of Jinja, Dokolo, Amolatar and Kampala.
The authorities asked money lenders to converse themselves with regulatory dos and don’ts by the Uganda Microfinance Regulatory Authority.
In their guidelines, a money-lender shall not take a National ID, passport, warrant card, or other documents establishing the identity or nationality of the holder, bank savings, ATM cards and security codes for the ATM cards as collateral for money borrowed.