A recent report by the Auditor General has raised serious concerns over irregularities in the disbursement of loans under Uganda's Parish Development Model (PDM), casting doubt on the program's integrity and effectiveness in promoting financial inclusion.
The Auditor General’s review of the loan disbursement process uncovered alarming cases of multiple approvals and payments made to the same individuals or households.
One example highlighted in the report shows that loans worth Shs 896 million were issued to 902 individuals, many of whom received multiple loans under questionable circumstances.
The findings revealed that 50 individuals with identical National Identification Numbers (NINs), names, and phone numbers received loans totalling Shs49.8 million.
In addition, 800 individuals with matching NINs and names but different phone numbers were approved for loans totalling Shs795.2 million.
Furthermore, 52 individuals with duplicate NINs but different names and phone numbers received loans worth Shs50.72 million.
The report also showed that 10,646 individuals had been approved multiple times for loans amounting to Shs10.432 billion, which were disbursed to 5,710 households.
Another issue raised was that Shs826 million was approved for 832 beneficiaries from unregistered enterprise groups, making it difficult to enforce recovery in the event of loan defaults.
Additionally, the report revealed that Shs8.611 billion had been disbursed to 13,844 beneficiaries, with each receiving less than Shs1 million, in violation of the PDM’s User Handbook, which stipulates that loan amounts should be capped at Shs1 million per household under the program’s financial inclusion pillar.
Launched by President Museveni in February 2022, the Parish Development Model was intended to transition subsistence households into the money economy, aiming to improve food security, increase incomes, and raise the overall quality of life for Ugandans.
These findings, however, point to significant lapses in oversight and management, undermining the program’s objectives and casting doubt on its ability to deliver meaningful change for Uganda’s grassroots communities.