• Payment Systems

    Payment Systems

    Private Sector Initiatives In Payment Systems

    PSD recognizes the important and significant role of the private sector in the provision of competitively priced, suitable and widely accessible payment services, whenever possible and prudent. Consequently, banks and telecommunications providers have introduced a number of products in the banking industry.

    Automated Teller Machines (ATMs)

    Since the introduction of ATMs in Uganda in 1997, there has been rapid growth of ATM installation transaction volumes and values. First and foremost, the use of the ATM facility allows the cardholder of the appropriate encoded card to obtain funds anytime of the day or night.

    Today, ATMs have spread out countrywide to about 539 by end of December 2009. While about 216 ATMs or 40% are concentrated in Kampala, the remaining 60% are fairly distributed in the major upcountry towns, as shown in the table.

    Table 1: Distribution of ATMs Countrywide

     
    KAMPALA
    MBARARA
    JINJA
    MBALE
    ARUA
    GULU
    OTHERS
    ATMs
    216
    22
    21
    21
    17
    17
    249
    %
    40.0
    4.0
    3.5
    3.5
    3.2
    3.2
    46.4

    Table 2: Distribution of ATMs bank-wide

     
    STANBIC
    BARCLAYS
    CENTENARY
    EQUITY
    CRANE
    SCB
    OTHERS
    ATMS
    146
    83
    64
    47
    34
    29
    140
    %
    27.1
    15.4
    11.9
    8.7
    6.3
    5.4
    26

    The National Switch


    In June 2005, the Bankom Switch became operational. The switch was expected to encourage use of payment cards so as to make possible use of Electronic Funds Transfer at Point of Sale (EFTPOS). Furthermore, it was supposed to facilitate prepayments for consumption of utilities and loading of airtime on mobile phones.

    Phone Banking

    Banks have introduced a facility where customers can make enquiries regarding their balances by using the fixed phone facility. Registered customers are given a Personal Identification Number (PIN) which enables them use their mobile phones to access banking services except cash withdrawals.

    Personal Computer Banking

    PC Banking is a form of online banking that enables customers to handle a number of banking transactions from a PC via software installed by a bank into a modem. For instance, one may use the PC to view his/her account balance, request transfers between accounts like salary payment or pay bills electronically.

    Internet Banking

    Internet banking as a delivery channel which involves using computer network connected onto a website to transact banking activities. Several banks have installed the Internet facility with their customers who are using the channel.

    Point Of Sale (POS)

    Some banks have installed point of sale terminals at the supermarkets and petrol stations. These POS terminals enable customers with debit cards like the ATM to purchase goods and services using cards.

    Mobile Payment System

    In Uganda, the Mobile payment system was first introduced by two telecommunications service providers; MTN and Zain, as Mobile Money and Zap respectively. Other companies are making plans to provide similar services.

    Usage of Mobile payment facilities has become a popular means of transmitting money across different regions in Uganda because of its low transfer charges, quick and easy process and availability among the unbanked and rural communities of the population.

    Around 400,000 customers are currently using mobile payment facilities processing around 1.3billion UGX per day.