By Irene Simiyu and Nicholas Nyombi Prince
Mobile money, a service that allows people to do financial transactions on their phones has become so popular in Uganda, especially in the rural areas.
A recent Finscope study reveals that only 18% of Ugandans are served by the formal financial institutions. As a result, people in rural areas have found an alternative scheme in mobile money. The introduction of this service has tapped in the rural areas, where formal financial services hardly penetrate and are deemed to be out of reach for the common man.
The service has revolutionised the way people transact. It makes it easy to pay bills and carry out business transactions without having to be physically there. It saves time and money, because transaction can be made from virtually anywhere. Its very convenient and goes a long way to bridge the gap that had been left by the financial institutions.
A threat to banks?
Mobile Telephone Network (MTN) was the first to launch Mobile Money in March 2009, and other providers Uganda Telecom Limited (UTL) and Airtel have followed suit. For one to access these services, he/she needs to register with the mobile phone service provider where they are given an account and a secret code that is used when sending or withdrawing money.
Steven Mulumba, a coffee trader in Sembabule district says, it couldn’t have come at a better time. This service enables him to pay his suppliers, pay school fees for his children and better still pay his loans. However, some people think this trend is a threat to the commercial banks in the country who have failed to go deep down in the village, while others see it as a compliment to the conventional financial services.
Listen to Nicholas Nyombi Prince’s radio report below:
Watch Irene Simiyu’s TV report below: