MICROCAPITAL BRIEF: Mobile Money Agents in Uganda Call for Improvements to Network Infrastructure

Chairman Moses Ihoza of the Uganda Mobile Money Agents Association (UMMAA), which represents 12,000 Ugandan Businesses that allow users of mobile money services to upload and withdraw cash, reportedly said the organization is calling for improvements to network infrastructure to aid the growth of the industry. Interruptions in network communications, which are said to be common, reduce the income earned by agents.

Also, UMMAA agents reportedly are demanding to be allowed to sign onto the “pool joint account” at the Bank of Uganda, the country’s central bank. This type of account used by telecom companies to hold cash uploaded by all its mobile money users cash. Mr Ihoza reportedly said “We can’t be safe when we are not a signatory to that account.” While the reasons for this concern are not specified, it may be that agents are concerned that they may fail to be reimbursed for cash disbursed in excess of cash uploaded in the event of the insolvency of a mobile money operator.

Adamu Mugume, the executive director for research at Bank of Uganda, reportedly said the bank is working with telecom companies and the Uganda Communications Commission (UCC), an organization in the government’s Ministry of Information and Communications Technology, to develop a regulatory framework for the mobile money business. UMMAA is said to be in support of this effort.

As of December 2012, there were 2.8 million mobile money users in Uganda, an increase of 1 million in the last year. Approximately 18 percent of mobile phone subscribers in Uganda are registered as mobile money users.

By Nicole Boyd, Research Associate

About Bank of Uganda (BoU)
BoU, established in 1966 by an act of parliament, is Uganda’s central bank. It is mandated to supervise financial institutions in the country including commercial banks and non-bank financial institutions such as forex bureaus, money remitters, deposit-taking microfinance institutions and microcredit institutions. As of June 2012, BoU reported total assets of UGX 14.2 trillion (USD 5.7 billion).

Sources and Additional Resources:

The Independent (Kampala). “Uganda: Mobile Money Agents Fear Losses,” http://allafrica.com/stories/201301212185.html

The Independent (Kampala). “Uganda: Telecoms Not Worried About Competition From Orange Money,” http://allafrica.com/stories/201301181514.html

MicroCapital, January 8, 2013, “MICROCAPITAL BRIEF: Amid Mobile Money Fraud, Service Providers Deemed Uncooperative, Bank of Uganda Seeks to “Take Over” Industry,” https://www.microcapital.org/microcapital-brief-amid-mobile-money-fraud-service-providers-deemed-uncooperative-bank-of-uganda-seeks-to-take-over-industry/

MicroCapital, February 13, 2012, “MICROCAPITAL BRIEF: “Uganda’s Airtel Launches Mobile Money Platform,” https://www.microcapital.org/microcapital-brief-ugandas-airtel-launches-mobile-money-platform/#more-16901

MicroCapital Universe Profile: Bank of Uganda (BoU) https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Bank+of+Uganda+%28BoU%29

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