Financial technology companies have called for stronger measures to improve the reliability and security of Uganda’s digital financial services. The players in the country’s vibrant sector are warning that fraud, network failures and high transaction costs are threatening public trust in the rapidly growing mobile money sector.
Executives under the Financial Technology Service Providers Association (FITSPA) say the number of mobile money users, agents and other players in the industry has continued to grow, increasing the need for reliable networks, stronger cybersecurity and better coordination among service providers.
Albert Gitta, the Chief Technical Officer at MTN Mobile Money, said Uganda’s digital economy is expanding rapidly as more businesses and consumers adopt digital services.
He said the growth is also creating bigger challenges for fintech companies and regulators, particularly because mobile money has become an important part of everyday life for millions of Ugandans.
Recent statistics from the Bank of Uganda show that between 6.5 billion and nine billion mobile money transactions are registered annually, with billions of shillings moving through the different platforms.
Gitta said the high volume of transactions means that even a temporary disruption can affect large numbers of people, making network reliability and the security of customers’ money critical to the industry.
Gitta said many mobile money transactions are driven by urgent needs, including buying airtime and data, paying medical bills and sending school fees.
He said this places a high level of responsibility on fintech companies because customers can quickly lose confidence in a service when transactions fail or their money is at risk.
Gitta cited a network disruption earlier in July this year, which he said followed a power surge at an MTN data centre and affected millions of customers and agents.
He urged fintech companies to invest more in anti-fraud systems and work together to combat fraud, warning that losses and disruptions can quickly undermine public confidence in the entire industry.
Gitta was speaking at the eighth FITSPA Annual Fintech Conference held under the theme, “Scaling Fintech Innovation for Inclusive Growth and a Resilient Digital Economy.”
Japhet Aritho, Managing Director of Airtel Money, called for wider access to smartphones and digital financial services to enable more Ugandans to participate in the digital economy.
Aritho also called for greater investment in digital solutions for sectors such as agriculture, tourism, minerals, science and technology, alongside stronger cybersecurity measures and efforts to combat fraud.
He said fintech companies also need to develop interoperable systems that can allow customers to complete transactions across different networks when one platform experiences a disruption.
Aritho said the sector remains vulnerable because a major fraud incident affecting one company can damage confidence in the wider fintech ecosystem.
He said mobile money companies are moving towards greater integration of their systems so that a failed transaction on one network can potentially be completed through another.
Vincent Tumwijukye, FITSPA Chairperson and Chief Executive Officer of Future Link Technologies, said Uganda’s ambition to achieve a tenfold expansion of its economy will require more than incremental improvements in the technology sector.
He said the country needs a fundamental shift in how it develops talent, attracts investment and supports innovation. Tumwijukye identified talent, high-risk capital and informed media as three key pillars needed to drive transformation in the fintech sector.
He said Uganda cannot achieve its economic ambitions without stronger collaboration between government, businesses, universities and other players in the digital economy.
Tumwijukye also called on the government to extend the recently introduced Capital Gains Tax exemption for local companies regulated by the Capital Markets Authority to foreign companies that invest in Uganda but may not be domiciled in the country.
He said universities should also make digital and financial technology an integral part of their programmes to ensure a steady supply of skilled workers for the growing industry-URN. Give us feedback on this story through our email: kamwokyatimes@gmail.com
