All mobile money which do not register a single transaction within nine months shall be considered dormant and hence suspended, a new law indicates.
According to the National Payment Systems Act, which was passed last year and is currently under implementation by the Central Bank, mobile money companies are required to inform the account holder after nine months of inactivity of the pending suspension.
“At the expiry of the notice … the electronic money issuer [mobile money company] shall block the electronic money account [customer] and shall not permit further transactions until the account is reactivated by the customer,” the Act reads in part.
The National Payment Systems Act also indicates that a customer shall be given an opportunity to reactivate a blocked account in a process that is provided by the electronic money issuer.
“Where the account is not reactivated within six months after it has been blocked, the electronic money issuer shall close the account,” the Act indicates, noting that after the closure the balance on the account, together with details of the holder, shall be transferred to the Central Bank, which shall, on request within seven years after the account is transferred to the Bank of Uganda, refund any unclaimed balances to the account holder or to a legal representative in case of death.
However, if no claim is lodged for the closed account within seven years, the Act notes, the unclaimed balances shall be transferred to Consolidated Fund after which becomes a property of government.
The Act also effectively takes mobile money away from the operations of telecommunications services, requiring mobile money companies to establish subsidiary and standalone companies regulated by Bank of Uganda.
The Central Bank, acting under the National Payment Systems Regulations, has already issued licences to two companies, including MTN Mobile Money Uganda and Airtel Mobile Commerce Uganda to run MTN and Airtel’s mobile money platforms under separate entities.