The Deputy Speaker of Parliament, Rt. Hon. Thomas Tayebwa has called upon investors and entrepreneurs in Uganda to stop treating insolvency with stigma, saying that this can only be achieved if they create awareness about liquidation.
The Deputy Speaker made these remarks on Thursday, April 10, 2025, while launching the Insolvency Journal at the 8th Annual Insolvency Conference, held at the Uganda Registration Services Bureau (URSB) headquarters in Kampala.
At the event, Tayebwa said, “In today’s volatile global economy, businesses, especially small and medium-sized enterprises (SMEs), face increasing risks. Insolvency is not a sign of failure but a critical tool for recovery, restructuring, and continuity.”
He revealed that Uganda’s economy relies heavily on SMEs (Small and Medium-sized Enterprises), yet many of these businesses operate without proper records or systems, making recovery difficult when challenges arise.
“We must destigmatize insolvency and raise awareness that liquidation is not the only option available. Ensuring predictability and establishing safety nets for businesses are vital for attracting investors and building confidence in our economy,” the Deputy Speaker stated.
Ms. Lydia Aliwonya, a member of the URSB Board who was representing the Board Chairman, Amb. Charles Butagira noted that URSB is committed to Uganda’s National Development Plan (NDP 1V), with a strong focus on fostering a resilient and sustainable business environment.
“A robust insolvency ecosystem is critical for business recovery and economic growth,” Aliwonya said.
She pointed out that the government ought to equip all stakeholders with practical skills in business rescue, restructuring and insolvency management to encourage recovery.
“As our economy evolves, so must our solutions. Tackling insolvency challenges demands innovation, collaboration capacity building,” Aliwonya stressed, urging regulators, practitioners and stakeholders to combine efforts if the country is to design sustainable solutions for insolvency.
She noted that the URSB plays a crucial role in creating a safety net by protecting businesses, safeguarding creditors, and ensuring entrepreneurs receive a second chance.
“As the government, we are committed to supporting efforts that build a robust and harmonized insolvency framework, one that reflects regional and global realities and positions Uganda as an attractive investment destination,” she explained.
Companies That Have Gone Insolvent in Uganda
Let’s take a closer look at some of the notable companies that have gone insolvent in Uganda and why.
Crane Bank
One of the most notable cases of insolvency in Uganda is that of Crane Bank, a commercial bank that was founded in 1995. In 2016, the bank was taken over by the Bank of Uganda (BoU) due to financial difficulties. The BoU later sold the bank to DFCU Bank, a move that was seen as a rescue plan to protect depositors’ funds. Crane Bank’s insolvency was attributed to a combination of factors, including poor lending practices, inadequate risk management, and increased competition from other banks.
National Insurance Corporation (NIC)
This was Uganda’s largest insurance company until it collapsed in 2018. The company’s insolvency was attributed to a decline in premium income, increased competition from other insurers, and poor investment decisions. The Insurance Regulatory Authority of Uganda (IRA) intervened, and NIC was eventually acquired by the Liberty Group, a South African-based insurance company.
Uganda Telecom
Uganda Telecom (UTL) is a state-owned telecommunications company that went bankrupt in 2013. The company’s insolvency was attributed to a decline in revenue, increased competition from private telecom operators, and poor management. The government intervened, and UTL was eventually acquired by a consortium of investors, including the Libyan government.
Rwenzori Bottling Company
The Rwenzori Bottling Company, once a leading manufacturer of soft drinks in Uganda, faced financial difficulties in 2019. The company’s insolvency was attributed to a decline in sales, increased competition from other manufacturers, and poor management. The company was eventually acquired by Crown Beverages Uganda, which revived the business.
The insolvency of companies in Uganda highlights the challenges that businesses face in the country’s dynamic economic environment. While each company’s circumstances are unique, there are common reasons that contributed to their insolvency.