Overview:
Importantly, 92.2 percent of all mobile money transactions were low-value (under UGX 50,000) — a strong indicator that the platform is serving a broad base of low-income and rural users, aligning with national goals for financial inclusion and poverty reduction.
Mobile money continues to dominate Uganda’s financial landscape, posting robust growth and playing a pivotal role in driving financial inclusion, according to the Bank of Uganda’s March 2025 Quarterly Financial Stability Review.
The report highlights mobile money as the leading platform for digital payments, with rising adoption reflecting deeper integration of formal financial services into everyday life for millions of Ugandans.
The number of active mobile money accounts soared by 166 percent, reaching 33.7 million, a significant leap that underscores growing trust and reliance on digital financial services. This growth is closely tied to improvements in mobile phone penetration, digital infrastructure, and regulatory support over the past few years.
Transaction volumes increased by 20.9 percent, while values rose by 25.5 percent, reflecting both increased user activity and higher-value transactions. Importantly, 92.2 percent of all mobile money transactions were low-value (under UGX 50,000) — a strong indicator that the platform is serving a broad base of low-income and rural users, aligning with national goals for financial inclusion and poverty reduction.
Beyond payments, mobile money platforms are also increasingly being used for digital lending. The BoU noted that loan disbursements more than doubled, reaching 102.4 million loans valued at UGX 2.9 trillion during the review period. This reflects growing confidence in mobile credit services, particularly among micro-entrepreneurs and informal sector players who traditionally lack access to conventional bank loans.
Agent banking, which complements mobile money by expanding access points in underserved areas, also registered notable growth, with the number of agents increasing by 48.7 percent. However, the report notes a decline in the proportion of active agents, partly due to disagreements over commission structures, which has affected the sustainability of agent operations in some areas.
Despite these encouraging trends, the BoU warns that the rapid digitization of financial services comes with increased operational and cybersecurity risks. System vulnerabilities, phishing scams, and data breaches remain threats to both service providers and consumers. In response, the central bank has implemented a number of mitigation measures, including the December 2024 issuance of Cybersecurity Risk Guidelines aimed at strengthening the resilience of digital financial systems.
Additionally, the BoU is amending the National Payment Systems (NPS) Act to better regulate digital payments, enhance consumer protections, and ensure the efficiency and security of electronic transactions. These reforms are complemented by the ongoing implementation of Consumer Protection Regulations under the same Act, intended to promote transparency, accountability, and redress mechanisms in the fast-evolving digital financial ecosystem.
The BoU report concludes with a positive assessment of liquidity and credit risks in the payments ecosystem, saying these remain low, thanks in part to pre-funded Real Time Gross Settlement (RTGS) systems and fully backed electronic money, which safeguard against systemic shocks and transactional failures.