Our Savior Basketball Family Uganda

A reminder of why we fail to pay our loans from banks and financial institutions. A borrowed loan goes bad (becomes a Non-Performing Loan or NPL) when a borrower fails to make scheduled repayments for 90 days or more. Understanding why loans fail: 1. Skyrocketing interest rates: Commercial bank prime lending rates frequently hover between 16% and 22%, causing total repayment amounts to rapidly outpace borrower income. 2. Severe business shocks: Small enterprises face frequent disruptions like sudden supply chain bottlenecks, local market fires, or infrastructural deficits like prolonged power outages. 3. Extensive loan diversion: Borrowers frequently redirect commercial capital to fund non-income-generating social obligations, such as expensive wedding ceremonies or unexpected medical emergencies. 4. Over-indebtedness: Individuals regularly juggle multiple concurrent microloans or digital app loans to pay off older debts, creating a fragile cycle of financial distress. 5. Aggressive digital lending: Mobile money loan platforms offer instant, high-cost credit without thoroughly evaluating a borrower's true cash flow or capacity to repay. 6. Unpredictable agricultural shocks: Reliance on rain-fed farming exposes rural borrowers to crop failures, prolonged droughts, and heavy pest infestations that wipe out seasonal revenues. 7. Poor financial records: Many informal traders do not track daily cash flows, leading to flawed budgeting and a failure to set aside dedicated loan repayment funds. @BOU_Official @ugbankers @ibfsUg @hudson_mugweri @JKijjali @regesa @JudeBkenya @anderlukson