A look at rules governing fintechs in Uganda


On May 23, 2018, lawyers and other officials from Ortus LLP Advocates released an overview of the current rules and regulations that are being relied on to shape the financial technology ecosystem in Uganda.

Titled ‘Fintech and e-payments landscape in Uganda’, the report was worked on by a team that included Silver Kayondo, a general partner in Ortus LLP, who worked alongside associates Shawin Mabiya and Daniel Bill Opio, and consultants John Goslino, Roland Mosler and Davidson Conner.

In this report, which was summarized by SautiTech’s editor Nicholas Asingwire, the team talks about players under the fintech ecosystem, challenges they are facing and the laws that are being relied on by government to regulate the sector and what needs to be added.

Digital financial services (DFS) and financial technologies (fintechs) have immense potential to drive financial inclusion in Uganda because most Ugandans are unbanked by the formal banking institutions due to limited bank branch coverage in the country and inadequate infrastructure.

Digital financial solutions and technologies, therefore, provide a massive opportunity to beat these challenges and bring more customers into the ecosystem.

Players in Fintech arena include among others developers of apps and platforms providing wide-ranging innovative financial solutions and services such as core banking solutions, business applications, finFinancials, e-banking solutions, forex, IT & support.

Some of these players work under the Fintech Association of Uganda.

Mobile Money

As a financial transaction service, it helps mobile phone owners to send, receive, and store money in their mobile wallets. The service is currently operated by mobile network operators (MNOs) and financial institutions (mobile banking) who are regulated by the Uganda Communications Commission and the Bank of Uganda (BoU).

The central bank in 2013 enacted Mobile Money Guidelines, which have several regulations that cover areas like consumer protection and recourse, interoperability, financial crime among others.

The requisites for running a mobile money business in Uganda as per the guidelines are:

-Any entity providing or intending to provide mobile money services must be a registered limited liability company.

-If the entity intending to provide the mobile money services is not a BoU licensed institution, the entity must partner with a licensed institution, which must apply to BoU seeking approval for the provision of mobile money services in partnership with the mobile money service provider.

-The entity must provide proof of its financial position, a business plan and a risk management proposal.

-Lastly, the applicant entity must have in place appropriate and tested technology  systems.

BoU asks mobile money service providers to sign an agreement with a licensed institution, with which the former must have an escrow account; this money in that account belongs to the customers to cater for the unfortunate event that the service provider undergoes insolvency.

Mobile money service providers in Uganda are MTN, Airtel, Africell and Uganda Telecom or UTL.

Apart from the MNOs that provide the service, there are also other key players in the system like mobile money agents, who are the main interface between the clients and the mobile money service provider; master agents such as Simba Telecom control specific territory on behalf of the MNOs and are responsible for licensing mobile agents in those territories.

There are also payment aggregators that facilitate payments into customer mobile wallets across multiple MNOs and sometimes convert to multiple payment instruments such as mobile wallets for some customers and bank account for others, thus allowing customers to choose how they want to receive payments. Examples of aggregators are Ezee Money, Yo! Uganda, and Pegasus.

Aside from local players, money remittance services targeting Ugandans living and working abroad as an alternative to Western Union and Moneygram for sending money home. For example, provides a cheaper and more mobile-oriented means of enabling Ugandans in the diaspora to send money home.


To operate a mobile money service, several factors have to be considered and some of these include ensuring convenience and flexibility, financial inclusion, security (cashless process), easy accounting/transparency, introduction of agent banking and enabling regulatory framework.

The major challenges of mobile money businesses are taxes (government is set to roll out new taxes), high costs (for instance, infrastructure development), agent liquidity management especially in rural areas, regulatory uncertainty, financial risk and crime, weak supervision and enforcement.

e-banking and laws

All banks have implemented online banking services, enabling customers to conduct multiple financial transactions, including viewing and downloading electronic bank statements, funds transfers and utilities payments through the financial institutions’ websites and mobile applications.

The Electronic Transactions Act of 2012 (ETA) recognizes electronic transactions, and these are defined as exchange of information or data, the sale or purchase of goods and services conducted over computer-mediated networks. Electronic agents, internet service providers (ISPs), automated transactions, intermediaries, originators, data messages and e-Government services are also recognized under this law.

The Electronic Signatures Act of 2012 (ESA) recognizes electronic signatures as data in electronic form affixed to or logically associated with a data message, which may be used to identify the signatory in relation to the data message and indicate the signatory’s approval of the information contained in the data message.

Certificate service providers, electronic signature products, private keys, public keys, repositories, security procedures, time-stamps, transactional certificates, and verification procedures are also provided for.

The Computer Misuse Act of 2011 which criminalizes offences such as access or interception of any program or data without authority or permission, access with intent to commit or facilitate the commission of further offence among others has also been put in place.

Data Protection and privacy requirements are also generally rooted in the common law pending enactment of the Data Protection and Privacy Bill.

Besides UCC and BoU, other government agencies such as NIRA, the Uganda Revenue Authority (URA), the National Information Technology Authority (NITA), and the line ministries such as Ministry of ICT and the Ministry of Finance, Planning and Economic Development are also involved in the decision-making process by way of policies.

The Financial Intelligence Authority (FIA) is mandated with AML investigation, monitoring and prevention under the Anti-Money Laundering Act of 2013.


Cryptocurrencies, digital coins and tokens are currently not recognized as currencies and thus are not enforceable as securities. The BoU issued a public warning in February 2017 to the effect that whoever invests in cryptocurrencies is taking a risk in a financial space whether there is neither investor protection nor regulatory purview.

Consequently, there has not been any regulatory guidance from the Capital Markets Authority (CMA) on Initial Coin Offerings (ICOs) and Security Token Offerings (STOs).

However, there are a few operational crypto trading platforms in the market since BoU did not expressly ban crypto trading and investment. Utility tokens, payment tokens, equity tokens, token generation events (TGEs), token distribution events (TDEs), and security tokens are all not regulated at the moment.


All the banks have ATMs in major locations, but there are access challenges in rural areas. Credit cards are accepted at the major ATMs. Visa and MasterCard are the most readily acceptable, but Maestro, Discover Cards and American Express may also be used in a few spots. Surcharges may apply due to the banking/transactional fees incurred by merchants in Uganda to process payments on foreign cards.

Some cases of ATM fraud have been reported.

Forex and traveler cheques

Foreign exchange is accessible from banks and forex bureaux. However, travelers’ cheques (whether physical or electronic) are very cumbersome to cash out. There are a number of fintech forex exchanges, however, these are currently outside the realm of regulatory oversight because the forex regulations mainly focus on traditional “brick and mortar” forex bureaux. Most forex bureaux do not accept travellers’ cheques. The official forex rate can be obtained from BoU’s website (


There are currently no regulations or guidelines governing online/digital crowdfunding in Uganda. Crowdfunding and crowdsourcing are increasingly becoming common aspects of alternative finance. Internet-mediated registries are also not regulated. Kickstarter, Indiegogo, Crowd Funder, and GoFundMe are some of the most common crowdfunding sites used.

Online gambling

Online gambling is growing at a fast pace in Uganda as gambling operators increasingly cultivate their digital presence.

This is heavily powered by a very vibrant sports gambling industry mainly targeting soccer leagues such as the English Premier League, the Spanish La Liga, the Italian Serie A, the UEFA Champions League, etc.

Cashless gambling is a common feature of the industry since mobile money and automated payments are acceptable by all betting shops. The increasing number of Digital TV subscribers and online betting companies such as BetPawa, BetWay, Sports Betting Africa, abaBET, World Star Betting, and 256Bet will continue to attract users.

The regulator, the National Gaming Board has issued licensing requirements for online betting. Betting houses and casinos are also accountable persons under the Anti-Money Laundering Act of 2013.

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