By Jonan Kandwanaho
If you walked into any neighbourhood in Uganda today, chances are you'd hear a story of someone who borrowed money to pay school fees, clear hospital bills, or boost a small business.
Equally common would be the stories of borrowers who are struggling to pay back, cursing lenders for charging high interest rates.
But on the flip side, there's the lender who lent out their hard-earned money, waiting months on end without repayment — bills mounting and their business on the verge of collapse.
The blame game between borrowers and lenders is one of the oldest conversations in the world of money. But where does the truth lie? Is borrowing purely out of need or sometimes out of greed? And are lenders heartless or simply running a business?
When Desperation Knocks
Most borrowers approach lenders when they have exhausted all other options. The hospital won't discharge their loved one without full payment.
The landlord is threatening to throw them out. The child's school is closing doors on them. In such moments, the pressure is overwhelming any loan, no matter the terms, seems like a lifeline.
But what happens after the emergency passes?
Some borrowers forget the pressure that made them borrow in the first place. The urgency fades, but the repayment obligation remains. What started as a need ends up feeling like a burden — with the lender becoming the villain.
The Business Side of Lending
On the other hand, lending is not charity. It’s a business. Every lender has shareholders, staff salaries, office rent, and operational costs to meet. When a borrower defaults, it's not just the lender losing money it’s an entire ecosystem affected.
Some lenders are painted as exploiters simply because they charge interest. But what if we flipped the question — would you give your hard-earned money to a stranger without expecting something in return?
The truth is, without lenders, many people's dreams would remain on hold. That boda boda business wouldn't start. That child wouldn't return to school. That medical bill wouldn't be cleared.
Where Does the Problem Lie?
The tension between borrowers and lenders often starts with the terms of the loan agreement — or more accurately, the failure to understand those terms.
How many borrowers actually read the fine print before signing? How many lenders take time to explain the implications of default?
A loan agreement is not just paperwork — it's a contract binding two parties. Yet, too often, one party signs without reading while the other assumes they've understood everything.
Borrowing with a Plan
Borrowing is not the problem. The problem is borrowing without a plan.
Before signing any loan agreement, every borrower should ask themselves three key questions:
1. Why am I borrowing? Is it a need or a want?
2. How will I pay back?
3. What happens if things don't go as planned?
At Jonakee Holdings Limited, we've seen clients who borrow to settle one debt only to create a bigger one — the famous cycle of borrowing from Peter to pay Paul.
Yet we've also seen clients who borrow small amounts, invest wisely, and return with stories of transformed businesses.
The Way Forward: Borrow Smart, Lend Right
The relationship between borrowers and lenders should not be a battle. It should be a partnership.
Borrowers must commit to borrowing only what they need and what they can afford to repay.
Lenders must commit to explaining loan terms honestly and charging fair interest rates.
Both sides need each other — one to solve a financial gap, the other to earn a living from providing that solution.
What Do You Think?
Do lenders take advantage of borrowers' desperation? Or do borrowers blame lenders for their own poor decisions?
Join the conversation in the comments — let's hear both sides of the story.
The Author is the President Money Lenders Association of Uganda