NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Thursday, January 26, 2017

A wave of technological innovation has suddenly swept through the Ugandan banking space in recent times. Key developments within the sector have erased memories of dreary days when people had to walk into banking halls, wait in queues to withdraw money, deposit savings or request for a loan. Only people doing complex transactions have kept at this tedious process.

Historically, telecom companies have been providing easy connectivity through phone calls and text messages while banks only provided banking services. There has been noticeable convergence that has bridged the gap between telephony and financial services over the last months, thanks to technological innovation.

The trends: according to Mr Peter Kawumi, an innovations specialist at Financial Sector Deepening Uganda, this convergence was very significant in 2016.

“We have seen more banks providing mobile banking services which is basically banking on your phone. This is doing the basic transactions such as balance inquiry and funds transfer through the phone,” Mr Kawumi says.

He says some banks have gone an extra mile in providing push and pull services. Customers can now directly transfer money from their bank accounts to their mobile money wallets using a phone instead of a mobile money agent.