Uganda Bankers Association Calls for No Extra Charges on Electronic Card Payment - Newslibre

Uganda Bankers Association Calls for No Extra Charges on Electronic Card Payment

In a move aimed at encouraging cashless payment, the Uganda Bankers Association (UBA) has banned the extra charges that merchants and banks have been levying on clients making electronic card payments.

In their new campaign dubbed, “Pay with your Card at no extra cost”, the Uganda Bankers Association is aiming at increasing the usage of electronic card payment across the country. Last year, the Bank of Uganda banned extra charges applied on card payments by both merchants and banks, which the central bank stated was delaying the adoption of digital payments.

Dr Adam Mugume who is the Executive Director of Research at Bank of Uganda states that they had 2022 as the target for the economy to go cashless but this is all changing considering the bulk cash transactions in the economy at the moment. Bank of Uganda notes that cash payments rose above the average of UGX 423B to UGX 544B, a 20% increase from the year before.

However, with just over 2 million electronic cards issued from the 15 million accounts across the entire country in the same period of 2019, the move by the Uganda Bankers Association could help the central bank to realize the cashless target by the year 2022.

The Uganda Bankers Association wants extra charges on electronic card payments removed

Visa and Mastercard, are set to provide the necessary connectivity and infrastructure to power the electronic cards. The two are also the leading card payments network processors in the country with almost all cards in circulation powered by them. This is all aimed at helping both the UBA and the central bank to ensure that this target can be achieved.

UBA further called out merchants operating point of sale terminals to stop levying extra charges on customers. The Pay with your Card at no extra cost campaign will run for a duration of 6 months, highlighting the benefits of card payments and educating Ugandans about transacting at no extra cost through digital payments.

Uganda Bankers Association Calls for No Extra Charges on Electronic Card Payment - Newslibre
Dr Adam Mugume who is the Executive Director of Research at Bank of Uganda states that they had 2022 as the target for the economy to go cashless. (Photo/Dialy Monitor/File Photo)

How the lockdown could have been used as an opportunity to implement Cashless Payment

Despite COVID-19 bringing about the shut down of some businesses and a drop in the economy, there is a growing belief that the lockdown provided a massive opportunity for cashless payments to be implemented across the country.

In Kenya, the element of cashless pay is one that has grown massively where boda boda payments or say buying groceries from your neighbourhood stall lady is encouraged to be done via mobile money.

During the lockdown, where scientists had encouraged minimal exchanging of money, there was growing hope that it would have been the perfect time to implement cashless pay either via mobile money or electronic cards.

The argument being raised though is that there wasn’t prior funding for the set up of infrastructure so as to enable for proper cashless transactions. With the Uganda Bankers Association setting a mandate for the removal of extra charges on all cashless electronic card payments, the question now is on whether there could be such a mandate for mobile money transactions as well.

 

Also read: Will the Gig Economy Survive After Coronavirus?

Uganda Bankers Association Calls for No Extra Charges on Electronic Card Payment 1

Author: Moses Echodu

Moses is an avid Sports and Tech enthusiast. He loves to keep up to date with all the latest information and research on some of the most compelling stories.

1Shares

Leave a Reply

Your email address will not be published. Required fields are marked *