Authorities in Kitagwenda District have intensified efforts to recover Parish Development Model (PDM) loans after recording low repayment rates among beneficiaries who received funds during the first phase of the programme.
The district’s Commercial Officer and Parish Development Model Focal Person, Fred Musinguzi, said beneficiaries who received the loans three years ago have now exceeded the repayment period and are expected to start clearing their balances to allow other eligible households to access the revolving fund.
Musinguzi revealed that Kitagwenda District has so far received Shs22.75 billion under the PDM programme, of which Shs19.75 billion has been disbursed to beneficiaries across the district.
“Beneficiaries in the first cohort have now completed three years since receiving the money. They are already in arrears and should begin repaying their loans immediately. The recovery process has now commenced across the district,” Musinguzi said.
According to Musinguzi, the first cohort alone received approximately Shs32 million. However, despite the funds being disbursed over several years, loan recovery has remained significantly low.
“Out of the Shs19.75 billion that has been disbursed to beneficiaries, only about Shs40 million has so far been recovered. This level of recovery is still very poor and cannot sustain the revolving nature of the programme,” he said.
Musinguzi said parish chiefs, sub-county chiefs and town clerks have been directed to engage beneficiaries who have completed the three-year period and remind them of their obligation to repay the loans.
“We have instructed parish chiefs, sub-county chiefs and town clerks to engage beneficiaries and remind them of their obligation to repay. Those who fail to honour their repayment schedules will face stricter enforcement measures because these funds are meant to benefit other Ugandans as well,” he warned.
He added that district authorities would take a firm stance against persistent defaulters, noting that effective recovery is essential for maintaining the revolving nature of the Parish Development Model fund.
The Parish Development Model is the government’s flagship programme aimed at transitioning 3.5 million households from subsistence farming into the money economy.
Through the Parish Revolving Fund, organised parish SACCOs provide beneficiaries with affordable loans of up to Shs1 million to invest in income-generating activities.
Under the programme guidelines, beneficiaries are expected to begin repayment after a two-year grace period, allowing recovered funds to be extended to other households.
However, loan recovery has remained a major challenge across the country, with concerns that some beneficiaries have treated the funds as grants rather than revolving loans.
Previous audits by the Auditor General have highlighted delays in repayment, raising concerns about the sustainability of the programme and the ability of new beneficiaries to access funding.
Kitagwenda District authorities say the ongoing recovery campaign will help improve repayment rates, strengthen parish SACCOs and ensure that more households benefit from the revolving fund.
