Mobile Money Transactions in Uganda Now Valued at Shs 24 Trillion – Report

The new BoU Report shows that over 28 million Mobile Money  transactions are being carried out annually as of December last year.

Former Prime Minister Amama Mbabazi-leaning youth under their umbrella body, treatment store NRM Poor Youth Group, pilule have petitioned the ruling party’s disciplinary committee to have the chairperson and President Yoweri Museveni dismissed from his position .

Addressing journalists in Kampala on Tuesday morning, the youth led by Isa Kato said it’s high time the NRM chairman faced removal from office for falling short of effectively steering the work of the party.

“President Museveni has continued to misuse his office as the NRM Chairman and this was evidenced in February last year when he failed to give guidance to party members as the constitution was breached and the Kyankwanzi sole candidature resolution passed, which is against the Constitution,” said Kato.

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“He was aware of all this but failed to intervene,” he added.

President Museveni said then that NRM’s flag-bearer in the 2016 polls would need endorsement of top party organs.

“The issue of the 2016 NRM Candidate will be determined by the NRM National Executive Committee (NEC),” Museveni emphasised after receiving the sole candidature resolutions.

According to Kato, the Sole candidature resolution passed in Kyankwanzi has led to formation of cliques in the party which he says have promoted intrigue and passing of illegal decisions, adding that the party chairman is responsible for all the troubles facing NRM.

He further said President Museveni should speak out on the purchase of vehicles for top NRM officials estimated at Shs3bn.

“There is no clear record of who authorized the purchase of the vehicles yet a lot of money was used in the deal,” said Kato.

Ian Gumisiriza, another NRM Poor Youth Group member, said money was raised from members to construct the NRM house but the project is yet to kick off.

The youth blamed President Museveni for reportedly usurping the powers of the NEC and CEC before replacing the bodies with the NRM parliamentary committee which they said lack the mandate to pass any resolution on behalf of the party.

They also attacked NRM Youth leader Denis Namara and Minister Evelyn Anite whom they accused of sidelining the youth in taking critical party decisions.

Regarding Mbabazi’s declaration to stand for president in 2016, the Youth said, “There is nothing wrong with Mbabazi expressing his interest in the topmost office in the country because no one else in the NRM party has come out to declare the same interest.”

They added: “President Museveni has never come out to vie for being the NRM flag bearer and Mbabazi coming up is within the provisions of party constitution.”

President Museveni described as “premature electioneering,” Mbabazi’s announcement to contest in the 2016 polls.

Mobile Money transfer services have grown exponentially in the country with the total number of registered users now exceeding 18 million according to the latest information from Bank of Uganda.

Mobile Money which was pioneered in the country by MTN Uganda back in 2009, dosage has significantly increased access to financial services especially in the rural areas.

According to the just released Annual Supervision Report by the Central Bank, case the number of registered customers has grown by 17.1 million  [1016.6%] from 1.7 million in December 2010 to 18.8 million in December 2014. In last year’s report, health the figure stood at 17.6 million.

Similarly, the number of transactions has increased from 28.8 million in December 2010 to 496.2 million in December 2014, while the value of transactions rose from Shs 962.7 billion in December 2010 to Shs 24,050.2 billion in December 2014.

So far six Mobile Money platforms are in the market, following the 2013 acquisition of Warid Telecom by Airtel which saw Airtel Money and WaridPesa merging into Airtel Money.

The platforms are MTN Mobile Money, M Cash, M Sente , Airtel Money, Ezee Money and Orange Money. These hold their escrow accounts in Stanbic, Equity, Centenary and Standard Chattered Banks.

Mobile Money, which started off six years ago mainly as a person to person domestic remittance service has since evolved to enable remote purchase of airtime, payment of utility bills, payment of school fees, bulk payments such as salaries, payment of television subscription fees, international remittances, and savings.

Despite the rapid growth and relief ushered in money transfer, the central Bank highlighted in the report some challenges hindering Mobile Money, among them inadequate laws that would for instance provide for non-banks to be allowed to independently join the business.

At the moment all mobile money service providers must partner with licensed financial institutions, which then apply for BOU’s approval to offer mobile money services.

The report also noted the challenge of fraud and information systems security regarding the mobile money operations.

Cases have been reported involving Mobile Money company workers manipulating the systems to fraudulently generate e-money onto their own accounts.

Bank of Uganda projects that in the new future, Mobile Money will become an integral part of the national payment system, and thus its strict regulation must be highly prioritized.

Fortunately, the Bank of Uganda Act is being amended to grant the Central Bank powers to regulate and supervise the payment systems. In addition, a National Payment Systems Legislation is being developed.

The Central Bank is hopeful that once this legislation is enacted, payment service providers will be directly licensed by the Central Bank as payment operators.



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