Commercial lending rates rise to 19.7 percent in October 2025 – report
Meanwhile, the stock of outstanding private sector credit rose marginally to about Shs 24.35 trillion in October 2025, compared with Shs 24.29trn in September, representing a modest growth of 0.3 percent
KAMPALA, December 23, 2025 — Average weighted lending rates in Uganda for both shilling- and foreign currency-denominated credit edged upwards in October 2025, according to the Performance of the Economy Monthly Report for November 2025 released by the Finance ministry.
The report indicates that weighted average lending rates on shilling-denominated credit increased to 19.71 percent in October 2025, up from 18.45 percent in September. The rise was partly attributed to increased risk aversion among financial institutions.
Similarly, lending rates on foreign currency-denominated credit rose to 8.24 percent from 8.15 per cent over the same period.
Outstanding private sector credit rises
Meanwhile, the stock of outstanding private sector credit rose marginally to about Shs 24.35 trillion in October 2025, compared with Shs 24.29trn in September, representing a modest growth of 0.3 percent.
This growth was largely driven by shilling-denominated credit, which increased from Shs 17.48trn in September to Shs 17.56trn in October 2025. In contrast, foreign currency-denominated credit declined slightly, falling from Shs 6.81trn to Shs 6.79trn over the same period.
Credit extensions decline
According to the report, the value of credit approved for disbursement in October 2025 totalled Shs 1.93trn, down from Shs 2.12trn in September. Despite this decline, the loan approval rate, measured as approved loans against applications, stood at 76.7 percent, slightly higher than the 75.5 percent recorded in September.
In line with trends observed since the start of the 2025/26 financial year, key sectors including personal and household Loans, trade, building, construction and real estate, and agriculture continued to dominate credit allocations during the review period.
Personal and household loans accounted for the largest share of approved credit, at 24.7 per cent [Shs 477.5 billion] in October 2025. This was followed by trade at 16.2 per cent [Shs 312.8 billion], building, construction and real estate at 12.8 percent [Shs 247.9 billion], and business, community, social and Other services at 11.9 per cent [Shs 229.7 billion].
Other significant recipients of credit included agriculture, which accounted for 11.8 per cent, and Manufacturing at 11.3 percent.
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