The bank of Uganda has taken over the licensing and regulation of Mobile Money platforms from the Uganda communications commission. This follows the enactment of the National Payment Systems Act which gives the bank the mandate to regulate the financial technologies sector.
Mobile money is now part and parcel of everyday life in Uganda. In fact, mobile money platforms have been able to break boundaries that commercial banks for long struggled to penetrate, enabling the rural poor to engage in some of non – cash transactions. Mobile Money transactions hit sh80 trillion in 2020
Going forward, Mobile Money services will be separated from other services provided by telecommunication companies and regulated by the Uganda Communications Commission. Telecommunications are now required to incorporate separate companies to offer mobile money that will be supervised and regulated by the Central Bank. The first licences were given out to MTN and Airtel over the weekend.
The MTN platform will be run by MTN Mobile Money Uganda. Airtel Money will now be provided by Airtel Mobile Commerce Uganda.
According to Stephen Mutana the Head of Mobile Money Services at MTN Uganda, the regulation was long overdue.
The one year licence received by MTN Mobile Money Uganda will also not affect the current operations of the platform.
Economist Dr. Fred Muhumuza from Makerere University the Central Bank’s regulation will attract innovations and fair pricing on the platform.
He however cautions the banking sector to be innovative to compete with the fintech innovators
In a statement on Friday, Bank of Uganda Governor Professor Emmanuel Mutebire said the Central Bank had also licensed Wave Transfer Limited to operate under the regulatory Sandbox, which will provide a layer between banks and their innovations to facilitate collaboration between Fintechs and the banking sector.
