Mobile money transactions continued to grow in 2020 despite the impact of Covid-19 on the economy, a new report indicates.

According to the Bank of Uganda Annual Supervision Report for the year 2020, the volume of mobile money transactions rose significantly by 24.1 percent to UShs3.5 billion while the value grew by 28.2 percent to USh.93.7 trillion.

“This growth was significant in the quarter ending December 2020 as economic activity increased following continued easing of lockdown measures and as banks and the government continued to encourage the use of non-cash payments to limit the spread of COVID-19,” the BoU report reads in part.

 A total of 30.7 million customers were registered for the service at the end of December 2020 of which 19.8 million customers are active.

The Central Bank report comes two months after data released by the Uganda Communications Commission (UCC) showed that the number of mobile money agents has grown by 49,488 in two years. The growth is partly due to the shift to digital transactions that registered rapid growth during the Covid-19 related lockdown.

Mobile money has been one of the biggest drivers of the cashless economy and financial inclusion attributed to increased mobile penetration.

In a bid to regulate and better manage the sector, the government in 2020 enacted the National Payment Systems Act, 2020 whose main objective is to provide for the safety and efficiency of payment systems.

In line with the Act, Mobile money has been split as a standalone business which, going forward, will be regulated by Bank of Uganda as a financial service.

The move, which effectively takes mobile money away from telecom service operations has now been implemented with the issuance of financial services operator licences to Airtel Money, which will trade as Airtel Mobile Commerce Uganda and MTN, which has placed its mobile money business under MTN Mobile Money Uganda.