Uganda in Urgent Need of National Payment System, Says Central Bank
Bank of Uganda has said the country urgently needs a comprehensive National Payment System to licence and regulate new payment platforms in the financial markets.
Payment systems have evolved in the last five years precipitated by the rapid growth in the electronic payment space. However, about 76 per cent of transactions, according to the Central Bank, are made through cash notwithstanding the entry of electronic payment platforms such as mobile money and mobile banking.
In a speech delivered by Mr Elliot Mwebya, the Central Bank executive director information technology, during a consultative meeting on the draft National Payment System Bill in Kampala, Mr Emmanuel Tumusiime Mutebile, the Bank of Uganda governor, said just like other approved payment systems in the region, such as East African Payments System and the Comesa Regional Payments and Settlement System, Uganda needs a harmonised system to ease payments. "... a comprehensive National Payment System to provide an oversight framework for payment service providers, operators and instruments is urgently required," Mr Mutebile said, explaining that the Bank of Uganda Act 2,000 and the Financial Institution Act 2004 are either silent or have limitations on the regulation and supervisions of Payment Systems.
The National Payment System is currently undergoing a review before it is sent to the Finance Ministry for consideration and further adjustment. Uganda's money market, according to Mr Mutebile, has recently experienced an upsurge in privately operated payment systems such as debit and credit cards, Automated Teller Machines and mobile payment systems, which call for proper regulation and harmonisation.
The Central Bank, while unveiling the new National Payment System about two weeks ago, said they were leveraging on the fast-rated growth in technology to improve electronic payment platforms with the view of reducing cash payments. The National Payment System, according to the Central Bank, will seek to streamline regulation, a key ingredient that is currently missing in the payments system. Read more from All Africa.
Source: All Africa