It is no longer a dispute. Mobile money is the number one choice, especially for small transactions.
But just like any other business, mobile money registered mixed performance during the lockdown, according to data from Bank of Uganda.
In the first month of the lockdown – April - there was a drop in the value of money and number of times people transacted using mobile money.
However, in March, the month in which the lockdown was announced, there had been, according to Bank of Uganda, an upsurge in the number of mobile money transactions and value as people prepared for the months away from work.
Transactions, data indicates, had increased from 263.4 million in February to 279.8 million in March while value had grown to Shs7 trillion from Shs6.9 trillion in February on account of Covid-19 and related lockdown, which had limited movements and thus many people had one option - to transact through mobile money.
Additionally, according to Bank of Uganda, the increase in March, was attributed to initiatives undertaken by service providers to encourage use of digital payments.
During the period, data indicates, users or mobile money subscribers, grew to 27.9 million in March compared to 27.5 million in February.
Performance in April
However, in April the numbers started to move southwards due in part to anxiety or the hope that the lockdown might take much longer than earlier thought.
What started as a two-week lockdown extended to a month and months. Covid-19 infections in the country were increasing. The future was no longer certain.
Both value and number of transactions fell but registered users kept growing.
This indicated that while more people wanted to use mobile money, they were concerned about saving than spending.
Balances on customer accounts rose from Shs703b in March to Shs788b in April. It was also in April that salary cuts and job losses started. People were earning less.
This is seen in the reduction of customer deposits during the period from Shs1.9 trillion to Shs1.3 trillion and withdrawals from Shs1.8 trillion to Shs1.1 trillion, respectively in March.
However, person-to-person values increased and transactions also went up.
This could be explained by people’s increased reliance on friends and family for financial support.
A 2018 Finscope survey found that most Ugandan adults borrow from family members or friends, especially for unexpected expenses.
Performance in May
In May there was a little bit of optimism reflected through mobile money transactions as the platform was more active in the period than in April, perhaps due to talk of easing the lockdown.
President Museveni announced that private transport would resume on May 26 and a maximum of three people, all wearing face masks, would be allowed in the car.
Some businesses started to operate.
During May, the value of mobile money transactions rose to Shs6.9 trillion compared to Shs5.4 trillion in April, while transactions increased to 269 million from 245 million, respectively.
Registered users increased marginally. However, deposits fell further indicating a reduction in levels of earning.
However, withdrawals increased as businesses and movements were eased.
Withdrawals increased to Shs1.5 trillion in May from Shs1.1 trillion in April.
Yesterday, Ms Sumin Namaganda, the Airtel public relations manager told Daily Monitor that while they experienced a drop in Airtel Money revenues due different waivers, transaction value improved.
Data on bank-to-wallet and wallet-to-bank transactions in addition to merchant payments, were not yet available according to Bank of Uganda.