Few accounts bother BOU
Oct 20, 2003
THE small number of bank accounts continues to subject Uganda to a cash economy, leading to the preference of more notes and coins, Bank of Uganda (BOU) officials said last week
By Steven Odeu
THE small number of bank accounts continues to subject Uganda to a cash economy, leading to the preference of more notes and coins, Bank of Uganda (BOU) officials said last week.
Patrick Byabakama, the BOU director currency, said Uganda unbelievably had only 1.5m accounts from a population of over 25 million people.
“If we had many bank account holders, we would not be having the cash problems faced presently. We have only 1.5m accounts and only one million are active,†said Byabakama.
“If more people open accounts, this will supplement the cash transaction system as banks will be forced to introduce new banking services that do not involve cash,†he added. Byabakama was clarifying on the proposed sh50,000 note to be issued.
He said the note would have to be released soon to relieve those involved in big transactions.
“It is a safe note and we have done our best to ensure that counterfeiters find it difficult to fake,†said Byabakama.
“People will, however, have to be more cautious because losing a sh50,000 note will destabilise you,†he said.
Byabakama rubbished claims that the new note would phase out the smaller notes and coins and further cause inflation.
“I donot see the basic fundamentals of demand and supply being affected because of the new note. The BOU will keep on providing change by releasing smaller denominations,†he stressed.
THE small number of bank accounts continues to subject Uganda to a cash economy, leading to the preference of more notes and coins, Bank of Uganda (BOU) officials said last week.
Patrick Byabakama, the BOU director currency, said Uganda unbelievably had only 1.5m accounts from a population of over 25 million people.
“If we had many bank account holders, we would not be having the cash problems faced presently. We have only 1.5m accounts and only one million are active,†said Byabakama.
“If more people open accounts, this will supplement the cash transaction system as banks will be forced to introduce new banking services that do not involve cash,†he added. Byabakama was clarifying on the proposed sh50,000 note to be issued.
He said the note would have to be released soon to relieve those involved in big transactions.
“It is a safe note and we have done our best to ensure that counterfeiters find it difficult to fake,†said Byabakama.
“People will, however, have to be more cautious because losing a sh50,000 note will destabilise you,†he said.
Byabakama rubbished claims that the new note would phase out the smaller notes and coins and further cause inflation.
“I donot see the basic fundamentals of demand and supply being affected because of the new note. The BOU will keep on providing change by releasing smaller denominations,†he stressed.