One of the lessons learned from the global financial crisis was that crisis management frameworks in many countries are inadequate for dealing with systemic financial crises, and that financial regulators need proper tools to resolve failing banks and other systemic financial institutions in an orderly manner, without unnecessarily exposing taxpayers to risk of loss and causing wider economic damage.
Payment systems are an integral part of financial infrastructure. A safe and efficient payment system in Uganda is essential for transmitting BOU’s monetary policy as well as maintaining financial stability in Uganda. Its failure as a whole, or that of a participant or component, can cause other areas of the system to fail and thus transmit shocks through the financial system. Therefore, it is essential that BOU mitigates risks in the payment system through oversight of the payment system.
In the implementation of its oversight policy, the Central Bank observes international standards, and undertakes a range of activities that allow it to ensure compliance with these standards. The main activities are: