BOU wants banks to adapt mobile banking

By David Ssempijja

Deepening the penetration of financial services requires commercial banks to invest more resources in mobile banking technology to attract the unbanked population, a senior Bank of Uganda (BOU) official has observed.

Justine Bagyenda, the executive director supervision at BOU, noted that millions of potential customers for banks are scattered across the country in places that are not viable for permanent bank branches, a gap that can only be closed by boosting mobile banking, “Few people of the total population have bank accounts.

However, some of those without accounts have bankable money but find it difficult to access banking services either because they are not aware or the physical bank branches are miles away from them,” she said.

trueBagyenda was last week officiating at the opening of the 5th annual Banking, Finance and Insurance Expo organised by Royal Way Media.

She said banks such as Centenary Bank and Post Bank have taken significant steps into mobile banking technology innovations, but the country is too big to be adequately served by only these banks.

The banks invented the ‘Bank on wheels’ technology, with vans built with banking services.

“These are virtually movable bank branches manned by staff, with banking services such as on-counter or ATM deposits and withdrawals, accounts opening loan acquisition and servicing.”

Bagyenda said if such services are undertaken by more banks, the industry will get more competitive and supplement other financial service platforms such as micro-finance and mobile money which have attracted millions of subscribers.

According to BOU, there are 8.9 million registered mobile money customers, more than a quarter of the population.

Mobile money transactions totalled sh11.7 trillion in 2012, a 211% increase over the total in 2011.

Royal Way Media boss David Ssempala said the expo focused on empowering the public with a wide range of information about banking and insurance to deepen the understanding of products and enable informed decision making.

“We are optimistic that our cordial partnership with players in the financial industry will help consumers understand this dynamic financial sector with rapidly evolving markets.

People will be sensitised about different financial products and the benefits that can accrue from taking them up,” he said.

The expo is a meeting platform for the public, representatives of banks, insurance and other financial structures and gives opportunity to learn about the latest innovations in Uganda’s financial systems.