Uganda: CBA planning to launch mobile lending service M-Shwari
The service also allows users to save via mobile phone.Commercial Bank of Africa (CBA), which is in its second year of operations in Uganda, is seeking approval from Bank of Uganda (BoU) to launch mobile banking service M-Shwari in the country.
Launched in Kenya in 2013, it allows customers to borrow via their mobile phone at a minimum of Sh100 (€0.9) anytime. It also let users save as little as Sh1 and earn interest on their saving balance.
CBA Uganda's chief executive officier Samuel Odeke told The Monitor the product would improve the saving culture in Uganda and provide short term loans to micro-enterprises at "competitive" interest rates.
"At the moment, we are seeking the approval of the central bank before we can launch the product at least by the end of the first quarter of 2016. We are working with mobile operator MTN to test the product that will help develop the culture of savings and access to financial services," he said.
Mobile money was introduced in Uganda in 2009. Since then, it has experienced a steep growth. As of December
2014, there were over 18 million registered mobile money customers, and the average monthly number of transactions in the last quarter of 2014 was 46 million, according to figures from the Bank of Uganda.
In Kenya, Safaricom's General Manager of Financial Services Betty Mwangi-Thuo revealed that reports by the central bank have "lauded" M-Shwari as the most impactful contributor to the formal financial services sector "in the history of the nation".
M-Shwari has over twelve million customers who have in the last two years saved more than Sh135 billion (€1.2 billion) and taken out loans worth Sh30 billion.