President Museveni has assured the Muslim faithful that repayments for grants extended to their Saccos under the Parish Development Model (PDM) do not amount to riba.
Under islamic law, riba is strictly forbidden. It refers to any increase of a debt or a loan until its repayment. Some Muslims had expressed worry that the PDM repayments constituted riba because there is an interest element.
But Museveni, in a letter addressed to Taqwa Islamic Sacco in Mukono, said this view is misconceived.
He said the interest element in the PDM cash is aimed at ensuring that inflation does not erode the value of the loan.
…”Gavumenti ya Uganda eraamira abaana baayo mu buli muluka shillings 100 million buli mwaka (The government of Uganda wills Shs 100 million per parish per year). This is not a loan by government to the parish Sacco. It is a grant (kuwa buwi-just giving). Does the Quran say that Omuzadde talaamira baana be (A parent cannot give by will whatever he wants to his/her children?),” Museveni asked.
The Parish Development Model (PDM), launched in 2022, is aimed at transforming subsistence households into the money economy and lifting 17.5 million Ugandans in 3.5 million households out of poverty. Under the strategy Shs 100 million is sent to each Parish every year and it is shared among registered Saccos which engage in income generating activities.
