Ugandans are gradually resorting to keeping their cash in boxes and also reduce on the frequency of the transactions they make on mobile money which will in the long run affect the operations of businesses in Uganda, a new report suggested.
According to a survey conducted by Twaweza, Sauti za Wananchi on Uganda’s experiences of poverty and financial inclusion financial inclusion in Uganda has been largely driven by mobile money with 44% of the population being financially included through mobile money.
“Out of the entire adult population 28% were using formal banking institutions. Of these the larger proportion were the males and in the urban areas,” the report which was launched last week indicates.
More of the findings indicate that with the mobile money the female, youth and rural population have been enabled to use financial services.
These particular categories of the population have been identified as those that need special focus in the National Financial inclusion Strategy launched in 2017.
For this reason introduction of this tax on mobile money will create a barrier for the population that has little access to financial institutions.
Other barriers like the requirements to open an account in a formal financial institution have acted as drivers for the population to use mobile money.
The key reason some Ugandans do not use banks is because they lack sufficient funds to make it worthwhile (95%).
The population will most likely resort to keeping theory money in boxes and also reduce on the frequency of the transactions they make on mobile money which will in the long run affect the operations of businesses in Uganda.
On Tuesday the Parliament of Uganda was voting to either scrap or retain Mobile Money Tax.