The Advent of Mobile Banking & Mobile Money In Uganda


Perhaps the most recent innovation in Uganda under the NRM government. Mobile Money and Mobile Banking have made it very easy for people to transact business, purchase goods, and pay for services easily without necessarily going to the bank.

Ten years ago, MTN Uganda launched mobile money in Uganda, a service which allows subscribers to send and receive money. Mobile money services were first introduced in March 2009; Currently, there are seven mobile money schemes in Uganda.

Mobile money has demonstrated rapid growth in the last 10 years, demonstrating a new wave of financial transacting with transactions hitting Shs80 Million last year. As the Fourth Industrial Revolution gathers pace, innovations are becoming faster, more efficient and more widely accessible than ever before.

While meeting the  Parliamentary Committee on Information and Communication Technology in 2015, the Governor Bank of Uganda made these remarks in regards to Mobile Money:

“The business model involves a partnership between a mobile money operator and a commercial bank. The services offered have so far been restricted to domestic remittances, basic retail payments and money storage services. The growth in mobile banking has been phenomenal. As of December, 2014, there were over 18 million registered mobile money customers, and the average monthly number of transactions in the last quarter was 46 million while the average monthly value of the transactions was UGX 2.1 trillion. Mobile money therefore has a high potential to foster financial inclusion in Uganda.”

With over 100,000 agents around the country, Mobile Banking and Mobile Money have supported in bridging the unemployment gap by far through offering a service that has improved and contributed to financial inclusion tremendously.

A World Bank study finds a 1 percent increase in financial inclusion corresponds to a 0.51% increase in business creation, and a 15% inclusion increase leads to employment growth of 1%.

The power company UMEME, reported a 99.1% revenue collection rate in 2014 compared to 94% in 2012, the increased revenue collection rate was partly attributable to increase in mobile money payments over the years.

Today, 8 out of 10 people will use Mobile Banking to pay for services, or send funds to their loved ones without losing a sweat.

Among other benefits, the ease, convenience, the ubiquity of the service and speed of the mobile transactions increases tax revenue  and has improved efficiency in the system, and whatnot.