Museveni Dangles ‘Katale Loan’ Carrot as Kampala Traders Become Key Target in 2026 Election Drive

In a move widely seen as both economic empowerment and political strategy, President Yoweri Museveni has directed the Microfinance Support Centre (MSC) to roll out an unprecedented low-interest loan scheme—dubbed the Katale Loan—targeting over 10,000 market vendors in Kampala.

The scheme, set at just 8% interest per annum, is the latest tool in Museveni’s arsenal to woo urban low-income earners, particularly in the sprawling Kalerwe and Owino markets, as the 2026 general elections begin to cast a long shadow over Uganda’s political landscape.

Money in the Phone, No Collateral Needed

Unveiled at a high-profile meeting on May 20 at Fairway Hotel, the loan project will allow vendors—many of whom are trapped in the grip of predatory moneylenders—to access capital without traditional collateral.

Instead, small groups of five to ten traders will vouch for one another, and approved loans will be disbursed straight to recipients via mobile money.

“You don’t need security. You just need your group to verify you, and the money will go directly to your phone,” said Moses Byaruhanga, Senior Presidential Advisor on Political Mobilization.

Byaruhanga minced no words about the government’s intentions: rescuing traders from exploitative lenders, some of whom still unlawfully seize national ID cards as loan security.

“We are aware moneylenders are still taking your IDs—this is illegal,” he warned.

Political Undertones Amid Market Dust

While State House insists the initiative is purely developmental, its timing and targeting are politically loaded.

Kampala, long a hotbed of opposition support, is now being courted aggressively by the ruling NRM machinery.

For Museveni, who has ruled Uganda since 1986, urban loyalty remains a frontier yet to be fully conquered.

Market leaders like Mr. Badru Lutalo of Owino and Ms. Winnie Nalwoga from Nyanja zone welcomed the move but urged government agencies like KCCA not to suffocate the process with bureaucracy.

“Don’t frustrate this. We’re tired of moneylenders. Let this help us,” Nalwoga pleaded.

Vendors were also quick to promise that politics would not derail the initiative.

But behind the scenes, some view the project as Museveni’s olive branch to the informal sector ahead of a likely sixth re-election bid.

No More Mud Markets – If You Comply

Byaruhanga also took a jab at markets that previously resisted government upgrades over fears of land grabs and rental hikes.

“Some refused and are still operating in muddy conditions,” he said. This thinly veiled warning serves as a reminder that compliance could be rewarded—not just with loans, but with infrastructure.

KCCA’s Balancing Act

KCCA officials acknowledged hygiene and space challenges in public markets but pledged to support the Katale initiative.

Dr. David Musunga, KCCA’s Deputy Director for Production and Marketing, assured vendors, “We’re working with MSC to ensure better services.”

Julius Kasirye, in charge of commercial services at KCCA, added: “If this Katale loan fails in Kalerwe and Owino, it will be a setback for the rest of Kampala.”

How to Access the Loan

MSC clarified that any Ugandan between the ages of 18 and 75 with a NIN and national ID can qualify. The process includes forming small groups, getting verified by market leaders, and opening a bank account for tracking. “The funds can be accessed in as little as two weeks,” said Lotah Arimureeba from MSC, emphasizing that the institution is non-partisan.

As campaign season looms, the Katale Loan could either be a game-changer for Kampala’s traders—or yet another tool in the long-standing game of transactional politics.

One thing is certain ;President Museveni knows where the votes are—and now, so does the money.