How to Buy Shares on the Uganda Securities Exchange (2026): SCD Account, Brokers, Fees and Risks

What you are actually buying

A share is a slice of ownership in a company. Owning one gives you a claim on part of its profits, paid as dividends when the board declares them, and on whatever the market will pay for the share when you sell. Both are uncertain. The Uganda Securities Exchange's own investor page puts it plainly: share prices vary widely day to day, moved by the industry, the economy and politics as much as by the company itself. That is the trade you are making when you move money from a savings account or a treasury bill into the stock market: no guaranteed return, in exchange for the chance of a better one.

The market itself is small and well-policed. The Uganda Securities Exchange (USE) is licensed and supervised by the Capital Markets Authority (CMA), and every share traded on it has lived in electronic form since 2012. Nobody hands you a paper certificate any more; your shares sit in an account at the Securities Central Depository (SCD), a subsidiary of the exchange licensed under the Capital Markets Authority Act.

Step one: open an SCD account, which is free

You cannot hold a listed share without an SCD account. Two routes exist, and neither costs anything: the USE states that account opening is free and that there are no monthly or annual charges.

Through a broker. Walk into a licensed stock brokerage firm with identification and three passport photographs. The USE's own document list for an individual is:

• three coloured passport photos;
• a national ID, passport or driving permit (the USE accepts only these three);
• a completed Form 1A, which the broker provides;
• a summary of your business activities or source of income;
• a disclosure of your risk appetite.

A minor's account needs the child's birth certificate or a certified copy of their passport, the parents' details, three photos of the child and the same form. A company needs its certificate of incorporation, memorandum and articles, a board resolution and identification for the signatories.

By phone. MTN's instructions for its own channel: dial 16565# or open the MyMTN app, choose the option to create an SCD account, enter a valid National Identification Number, select a broker/dealer, accept the terms and confirm with your MoMo PIN. An application ID is generated, and once validated your SCD account details arrive by SMS. MTN states the account is free. This is the route the telecom built for its own share offers, but the account it creates is an ordinary SCD account tied to the broker you chose.

Either way, you end up with an account number at the depository and a broker attached to it. The broker is the only way in: the CMA's guidance is that shares on the secondary market can only be bought through a licensed broker/dealer, and that you must deal only with licensed professionals. The CMA publishes the list of licensed broker/dealers, and the SCD's own participant list names the broker dealers it settles for: Chipper, Crested Capital, Dyer and Blair, SBG Securities and UAP Financial Services. Check the name you are given against the regulator's list before you hand over money, exactly as you would check a lender against the list in our guide to loan apps in Uganda.

Step two: fund the account and place an order

The mechanics, as the USE describes them:

1. Tell your broker which listed company you want to buy and how many shares. The CMA notes that most past public offers have set a minimum of 100 shares, with further purchases in multiples of 100; on the secondary market your broker will tell you the lot size for the counter you want.
2. Deposit the money into the broker's trust account. For local investors payment is up front: the broker will not post a bid it cannot settle.
3. The broker posts your bid on the Automated Trading System during trading hours, which the USE publishes as 9:00 a.m. to 1:00 p.m. East Africa Time.
4. When your bid matches a seller's offer, the trade is done and the broker credits the shares to your SCD account.

Selling is the mirror image: a Sell Order form to your broker, who posts the order; on a match the shares leave your SCD account and the money is sent to your bank account. The USE's investor page says this is where the proceeds go, so the bank account you give the broker at onboarding is the one that matters; our guide to opening a bank account in Uganda covers choosing one that does not eat small transfers in fees.

What it costs

The one figure the regulator publishes is the broker's commission. The CMA's FAQ states that the broker/dealer charges a fixed commission of 2.1% of the total value of your transaction. On a UGX 1,000,000 purchase that is UGX 21,000; sell the same shares later and the commission applies again on the way out. Over a round trip, your shares therefore need to rise by a little over 4% before you have made anything at all, which is the first reason the exchange is a place for money you can leave alone.

Ask the broker, in writing, for its full tariff before your first order: whether anything is charged on top of the 2.1%, what the SCD or the exchange levies per trade, and whether there is a minimum charge on small orders. The USE's own pages say the SCD account itself is free; they do not publish a per-trade levy, so take the broker's written schedule as the figure, and keep it.

Settlement: T+3, and why the money is safe in between

A trade on the USE settles on T+3: three business days after the day it is executed. The SCD's description of the process is worth understanding, because it is what protects you from a broker who takes your money and does not deliver. Settlement is delivery versus payment: on the settlement date, the seller's securities account is debited and the buyer's credited at the same moment the funds move between the settlement participants' accounts at the Settlement Bank, on a net basis. The SCD describes that simultaneous exchange as guaranteeing the irrevocability of settlement, and it maintains a Guarantee Fund to ensure the selling participant delivers and the buying participant pays.

Practically: expect your shares to show in your SCD account, and sale proceeds to reach your bank, three business days after the trade, not the same afternoon.

Dividends, and what the tax authority keeps

Some listed companies pay dividends, the USE notes, which can make money for an investor even if the share price does not rise. The dividend is declared by the company's board, so it is neither fixed nor guaranteed.

What is fixed is the tax treatment at source. The Uganda Revenue Authority's published rule is that a resident company paying a dividend to a resident shareholder must withhold tax at 15% of the gross dividend, except where the dividend is exempt in the shareholder's hands, and that where the shareholder is a resident individual, the tax withheld is final. Final means you do not declare that dividend again on a return and you cannot claim the withheld tax back against other income. Non-residents are also subject to withholding on Ugandan-source dividends at 15%.

Tax advisers commonly cite a lower withholding rate for dividends paid by companies listed on the USE to individuals. URA's own page does not state it, so this guide does not print it. The reliable number is the one on your dividend advice or contract note: it shows the gross dividend, the tax withheld and the net paid, and that is the figure to keep for your records.

The risks the exchange itself warns about, and two it does not

Price risk. The USE's page says it: prices vary widely day to day, and a company's results can turn on its industry, the economy or politics. Money you need next term is not stock-market money; our unit trusts and money market funds guide covers where short-term money belongs.

Concentration. A small exchange means a short list of companies and a few large ones dominating it. Buying one share on a tip is a bet on one business. If you can only afford one counter, that is a reason to think about a unit trust first and shares second.

Liquidity. Trades happen when a bid meets an offer. In a thin market a sell order can sit for days, which is why the exchange's 9:00 to 1:00 window and your broker's judgment on price both matter. Decide the price you will accept before you place the order, not after.

The broker, not the market. Your money goes into the broker's trust account before the trade, and your proceeds come back through the broker. That is why the licence check is not a formality. The CMA's instruction, if you have a problem with your broker/dealer, is to contact the CMA: Uganda Business Facilitation Centre, 8th Floor, 1 Baskerville Avenue, Kololo, telephone +256-414-342788/91, info@cmauganda.co.ug. For a bank, insurer or lender the route is different; our guide to complaining about a financial institution in Uganda covers it.

A first-timer's checklist

1. Decide what the money is for and when you need it. Shares are for money you can leave for years.
2. Open the SCD account, free, through a licensed broker or by dialling 16565#. Keep the SMS with your account details.
3. Confirm the broker's name on the CMA's licensed list.
4. Get the broker's tariff in writing. Budget 2.1% in and 2.1% out, plus whatever else it discloses.
5. Fund the trust account; set a price you will pay; place the order; expect settlement on T+3.
6. Keep every contract note. It is your proof of ownership, your cost base, and your record of the tax withheld on dividends.
7. Read the company's results when they come out. You are an owner now.

Frequently asked questions

How much do I need to start? There is no published minimum for the account, which is free. For a purchase, the CMA notes that past public offers have set a minimum of 100 shares and multiples of 100; on the secondary market the practical minimum is 100 shares at the current price plus the 2.1% commission. Ask the broker whether it applies a minimum charge to small orders.

Can I open an SCD account without going to a broker's office? Yes. MTN's channel opens one by USSD (16565#) or through the MyMTN app with a valid NIN, and assigns the broker you choose during the application. You still trade through that broker.

How long until the shares are mine? Three business days after the trade (T+3), when the SCD credits your account and the money moves at the Settlement Bank.

Are my shares safe if the broker fails? Shares are held in your name at the SCD, not in the broker's books, and settlement is delivery versus payment backed by a Guarantee Fund. Cash sitting in a broker's trust account before a trade is the exposure to manage: fund an order when you place it, not months in advance.

Do I pay tax when I sell at a profit? This guide does not cover capital gains on share sales, which depend on your circumstances; it covers only the withholding on dividends, which URA states is 15% at source and final for a resident individual.

Can a foreigner buy shares on the USE? The SCD settles for custodian banks as well as brokers, which is the route institutional and foreign investors use. Ask a licensed broker or custodian what identification and payment rules apply to you.

Sources

• Capital Markets Authority (Uganda), Frequently Asked Questions, cmauganda.co.ug, read 24 October 2026. Primary: licensed-broker rule, 2.1% commission, 100-share minimum in past offers, complaints contacts, CMA's role.
• Uganda Securities Exchange, Investor FAQs; KYC Requirements; About the SCD; Clearing and Settlement, use.or.ug, read 24 October 2026. Primary: free SCD account, document list, buying and selling steps, trading hours, T+3 delivery-versus-payment settlement, Guarantee Fund, SCD participants.
• MTN Uganda, "How to apply for MTN Uganda shares using MTN MoMo", mtn.co.ug, read 24 October 2026. Primary for its own USSD channel (16565#) and the free account it opens.
• Uganda Revenue Authority, Withholding tax, ura.go.ug, read 24 October 2026. Primary: 15% withholding on dividends to resident shareholders, final for resident individuals; 15% for non-residents.

Last reviewed 24 October 2026 against the regulator's, the exchange's and the revenue authority's own pages. This is general information about how the market works, not a recommendation to buy any share. Commissions and levies are quoted as published; confirm your broker's current tariff in writing before you trade.