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11.3m mobile money accounts inactive
Mobile money has experienced rapid growth in the last 10 year, but there is an increase in inactive mobile money accounts. Photo / File
What you need to know:
- According to the UCC Market Performance Report, only 26 million mobile money accounts out of the 37.3 million are active
At least 11.3 million mobile money accounts remained inactive in the three months between January and March, according to a report by Uganda Communications Commission (UCC).
The report, which measures performance of the telecom sector and other communication channels indicates that during the period to March Uganda registered an increase in mobile money accounts from 36.8 million in January to 37.3 million, reflecting an addition of about 500,000 accounts.
However, the report noted that only 26 million were active in the three months or in 90-day lag within which, under the National Payment Systems Act, an account is declared inactive.
“In regard to account activity, active mobile money accounts in the 90-day period grew from 25.2 million in [December 2022] to 26 million in [March],” the UCC Market Performance Report, reads in part.
However, the UCC report does not indicate which telecom company has the largest share of inactive accounts.
Under the National Payment Systems Act, a mobile money or an electronic money account is declared inactive if it takes 90 days without performing a transaction.
They are subsequently suspended before they are declared dormant in the event that they remain inactive for a stipulated period of time. Mobile money has seen increased growth, becoming one of the most important products in the financial sector.
Mr Fred Otunnu, the UCC director corporate affairs, said that whereas there had been growth there was a reduction in mobile money activities following the conclusion of the festive seasons.
UCC also noted that in terms of year-on-year growth, mobile money registered an increase of four million new accounts, reflecting a 12 percent growth since March 2022, while agent footprint grew to 472,000 agents across the country.
During the period, UCC indicated that the industry recorded 1.44 billion mobile money transactions, up from 1.4 billion due to a spike in transactions such as person-to-person, transfers, utility and merchant payments, gaming and school fees payments.
The report also noted the mobile financial spaces had seen an increase in adoption of unstructured supplementary service data for cashless payments, indicating that sessions grew to 10.7 billion USSD or 6 percent from 10.1 billion in December 2022.
The growth, the report noted was due to increased activity in mobile banking and balance check, school fees and utility bill payments, prepaid mobile recharge, money transfers, mobile top-up, booking and reservations.
UCC also reported that the industry had recorded quarterly revenues of Shs1.34 trillion, with a net addition of Shs58.4b generated from a combination of earnings from voice, data, infrastructure lease and other communication services excluding mobile money.
Revenue generated from mobile voice and data services continues to dominate the telecom sector, followed by tower lease revenues.
