BOU warns financial institutions against hi-tech fraud

The Central Bank has warned financial institutions against using technologies that are susceptible to cybercrime in the name of providing financial inclusion to the rural populace.

"You must always be mindful of the fact that financial services have become more sophisticated and integrated, and in the process become prone to operational and other risks," Prof. Emmanuel Tumusiime the governor of Bank of Uganda said.

This is contained in a speech read for him by the executive director supervision in Bank of Uganda, Justine Bagyenda, during the launch of financial inclusion technologies for SACCOs in Kampala.

The governor pointed out that SACCOs can adopt technologies which are purposely designed to help institutions identify and respond to various risks and comply with national legislations by implementing tailored processes and systems.

He welcomed the Future Link Technologies initiatives for the launch of a new product with theme: "Enabling Financial Access for all, Transforming lives with ICT."

"The approach by Future Link Technologies to support the extension of financial services to SACCO members using advanced Information Technology solutions is very welcome and commendable" he said.

He noted that the Central Bank attaches great importance to innovative products and channels that have the potential of increasing financial inclusion amongst the populace of Uganda.

"Technological innovations have the potential to reduce costs and accelerate the uptake of financial services by those that would otherwise, be excluded from the formal financial system," he said.

Rose Twinamasiko tries to make a transaction using her phone to transact. Photo by Francis Emorut

He appealed to the management of Future Link Technologies to ensure low operational costs that would enable them to maintain a competitive edge in the market.

Vincent Tumwijukye, the executive director of Future Link Technologies told members of different SACCOs that the cost implications of the new technology will be cheaper than ordinary mobile money charges.

The new technology enables SACCO members to transact business from any part of the country including hard to- reach areas once you are connected to the bank system. You can make payments and withdrawals using your mobile phone.

He said the system has security features which can guard against fraud.

Anthony Kituuka, the executive director of Equity Bank explained the new financial inclusion system will not be limited by physical location.

"It will happen in real time. You will be able to track your transaction be it mobile or automation," Kituuka said.