Unclaimed mobile money goes to govt coffers seven years later – BoU

Tuesday September 28 2021

Mr Mackay Aomu, the director national payment systems at Bank of Uganda. PHOTO/courtesy


How do mobile money issues fit in the Bank of Uganda mandate?

In September 2020, government passed the National Payment Systems Act, 2020 and in March, we had the implementing regulations gazetted. So, this law has many provisions but the key one is that we had to separate the business of voice, and data away from issues of electronic money.

Accordingly, telecoms had to incorporate companies doing electronic money issues only. Mobile money has shown a lot of promise for this country and now we see a lot of derivative products coming out of mobile money. Initially, it was sending money to one individual but currently, it is different.  You can move from your bank account to your wallet, and from your phone to the bank account to the extent, the electronic wallet or mobile money account is as good as your bank account.

Even development partners such as International Monetary Fund consider it as an account. So, we do not only count savings, or fixed deposit accounts but also mobile money wallet accounts. 

What is a dormant mobile money account and how does it become one?

The mobile money account is not your phone number. Usually, when you send a message, the number that appears on delivery messages is your account. Many people do not take a keen interest in that. Electronic money accounts are monitored by these companies.


If there are no activities on the account for nine months, it becomes a dormant account. Before that, the electronic mobile money company is supposed to give a one-month notice due to the expiry. At the end of the eighth month, you should be informed that your account is running dormant for the remaining one month. Once you reach nine months and you have not responded, it becomes dormant.

What happens to the money that is not claimed on a dormant account for years? 

After declaring it dormant, the mobile money companies are supposed to inform you that your account is dormant within five days and inform you how it can be made active. In addition to the nine months, if you do not do anything in the next six months, the account is closed. So, you are given 15 months to do some transactions before it is closed.

We had discourses on the duration with all stakeholders and concluded that the period is good enough. To emphasise this, the telephone number remains active but the mobile money account is what is affected.

If there is money on the mobile phone after 15 months, what happens to the money?

When the law was being developed, it was agreed that the money should be sent to the Central Bank. We have already opened an account to receive dormant electronic money.

The Central Bank is supposed to keep it for seven years and if there are no claims within seven years, according to the law, it was agreed that the money should be transferred to the Consolidated Fund (government).

However, in Kenya, they have already formed a different arrangement.

They have an unclaimed financial asset organisation that received the unclaimed money. In Uganda, we are also doing the same. With such an organisation in place, and with an amendment in the law, after seven years, the money may not go to the consolidated fund but rather be kept by the unclaimed asset finance company.

Within the seven years, what is required of me to claim that money?

With financial matters, you must have the right legal documents such as powers of attorney, and identification. Ideally, once you prove yourself beyond doubt, then you should be able to access the money.

Once you have gone through the process of becoming an administrator of an estate, then that should be okayed.

In an unfortunate incident such as death of a relative, what are the possible complications that may make it hard to claim within the seven years?

The main thing is identification. We have to know who you are including next of kin. These are areas we are continuing to look through and amend accordingly but in the meantime, we are happy that there is something that works. You know laws are not made once.

This law is one of the youngest laws we have now and we have started to implement it. Although we are still improving some areas in the law, we have already issued five licences to companies to provide mobile money services to promote fintech innovations.

There is what they call regulatory sandbox where we allow you to be creative under a controlled environment under the supervision of the Central Bank to pilot your products with a selected number of customers. 

You are given six months to do it. If it is successful, then you can ask for a licence. If it is not successful, you may be given another extension of six months, but your product must work within one year.  We are happy that the approvals we have given so far, have already applied for a full licence.

In a scenario where you have a mobile money account but during registration, you used somebody else’s National Identification Number. What trouble comes with that?

It would be a big complication because the only person who can claim is the owner of the National Identification Number (NIN). Actually, we are going to dwell more and understand these dormant balances because why one would keep money and forget it? We are talking about Shs1.7 billion unclaimed money! Finally, if I have issues with mobile money, where do I come for redress?

The Central Bank has the mandate. We are the ones who license and exit the player who breaches.

Unclaimed money

According to Section 57 of the National Payment Systems (NPS) Act, 2020, a dormant account is one that has not had any activity for a period of nine consecutive months. The Electronic money issuer shall give notice to the customer at least one month before the expiry of 9 months.

At the end of the eighth month, you should be informed that your account is running dormant for the remaining one month. Once you reach nine months and you have not responded, it becomes dormant.

Bank of Uganda shall pay unclaimed mobile money balances to the customer if the claim is made within 7 years. If the account owner is deceased, their legal representative, or administrator of his estate, shall make such claim.

In case of unclaimed money in commercial banks, unclaimed money shall after 5 years from the advertisement be transferred to Bank of Uganda.