Prosper

Spearheading rural finance services using mobile vans

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Raising money as a group offers good opportunites for development financing.

Raising money as a group offers good opportunites for development financing. 

By Nicholas Kalungi

Posted  Tuesday, March 5   2013 at  02:00

In Summary

Through the use of mobile banking vans financial institutions are able to extend financial services to rural Uganda and nearer to the people who want them.

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The use of formal financial services continues to be low with about 3.5 million accounts shared among a few Ugandans out of a population of 35 million people.

Insufficient banking services in Uganda are attributed to a number of reasons including high rural population, stringent conditions for starting or maintaining a bank account and the absence of infrastructure to facilitate rural finance outreach among others. However, a number of banks continue to maneuver through a number of measures that seek to increase the penetration of banking services most especially in rural areas.

The measures include mobile banking vans as well as standalone ATM kiosks spread at key commercial points of peri-urban rural trading centres. Mobile banking vans are moving bank facets fitted with a range of financial services. They usually move around trading centers, market day places along predetermined routes and in other public places or easily accessible places.

Mass market based banks especially Opportunity Uganda and Post bank have greatly invested in this mode of outreach service mainly in the Eastern and Northern parts of Uganda even as far as the Karamoja region.

These banks are doing this in partnership with Uptime solutions Uganda, a company that remodels some of these mobile vans into financial halls. Uptime Solutions Uganda offers a catalogue of outdoor services in areas of retail banking, enterprise solutions and biometric and smart card services.

Picking up the idea
“We looked at other developed and developing economies including India and Bangladesh which have local companies with a niche in the provision of low end banking solutions to customers, we decided to introduce the same model here,” Mr Tonny Miiro, the Uptime Solutions managing director told Prosper in an interview.

He said: “We are a demand based service providing solutions through the use of tools tailored to meet market requirements as well as increasing financial service penetration in rural areas.” According to Miiro, even with technology, many people mainly in rural areas still believe in physical presence and visibility when it comes to offering financial services. This makes mobile banking vans an essential item.

“The market reality is that people want bank services closer. That is what we are doing. It is important that government comes up with more policies that call for more inclusive bank services provided by financial institutions as there is demand,” he said.

Uptime solutions Uganda was founded in 2007 as a market driven company, sourcing and developing innovative solutions that increase customer confidence in the information technology and financial services business.

nkalungi@ug.nationmedia.com