Mobile money has become one of the biggest sources of borrowing in Uganda, with millions of people now relying on their phones for quick loans instead of traditional banks.
In 2025 alone, Ugandans borrowed at least Shs2.75 trillion through mobile money platforms, highlighting how digital lending is rapidly changing the country’s financial system.
The biggest share came from MTN Mobile Money, which disbursed Shs2.7 trillion in loans during the year, according to the company’s 2025 Annual Report. Airtel Money also reported Shs50.6 billion in loans and advances on its books, showing the growing role telecom companies are playing in providing credit.
The figures reveal more than just rising borrowing levels. They show that many Ugandans are now using mobile loans as part of their everyday financial lives.
Unlike bank loans, which often require paperwork, collateral, and long approval processes, mobile money loans are usually small, instant, and accessed directly through a mobile phone. Borrowers can apply within minutes and receive money almost immediately. This convenience has fuelled massive growth in usage.
MTN said the number of borrowers on its platform increased from 2.2 million in 2024 to 3.4 million in 2025. At the same time, the number of loans issued jumped to 223 million, representing a dramatic rise in borrowing activity.
The sharp increase in loan transactions compared to the number of borrowers suggests that customers are borrowing repeatedly, often taking multiple small loans within short periods.
For many Ugandans, especially those working in the informal sector, mobile money loans have become a quick solution for daily financial needs such as transport, school fees, emergencies, business stock, or household expenses. This trend is reshaping how credit works in Uganda.
Traditional banks mainly focus on larger loans for businesses, property, and long-term investments. Their lending processes are slower and heavily regulated, with growth usually tied to economic conditions and interest rates.
Mobile money lending operates differently. Telecom companies use customer transaction histories and digital behaviour to automatically determine who qualifies for a loan. This allows them to issue credit quickly and on a much larger scale.
As a result, borrowing through mobile money is growing much faster than lending in the traditional banking sector.
According to the Bank of Uganda Integrated Annual Report 2025, lending by commercial banks, credit institutions, and microfinance deposit-taking institutions grew by 8.8 percent during the year. While this reflected recovery in the formal financial sector, it was far below the pace seen in mobile money lending.
The rise of digital borrowing has also been supported by expanding financial inclusion and increased use of digital payment systems across the country.
Bank of Uganda estimates financial inclusion in Uganda has reached 70 percent, creating a larger customer base for mobile financial services.
Telecom companies are now positioning mobile money as a major standalone business rather than just an additional service. MTN, for example, said it plans to deepen investment in digital financial services, partnerships, and infrastructure as it separates mobile money operations from its core telecom business. The rapid growth of mobile lending is also changing the broader economy.
With hundreds of millions of loans being issued annually, mobile money is increasingly influencing spending patterns, cash flow, and how money circulates in communities. Experts say the shift shows how digital platforms are evolving into full financial ecosystems that combine payments, savings, and borrowing in one service.
While banks remain critical for financing large investments and businesses, mobile money is filling a different gap by offering fast, accessible credit to millions of ordinary Ugandans. The growing popularity of mobile loans shows that borrowing is no longer viewed as a rare financial decision for many people. Instead, it is becoming an everyday tool accessed instantly through a mobile phone.
