The ever-increasing proportion of Ugandans with access to mobile connections means the mobile banking sector is increasingly looking a more lucrative option for investment than the traditional banking hall. According to financial inclusion indicators reported by the Bank of Uganda, barely half of Uganda’s adult population own a bank account whereas over three quarters have active mobile money accounts.
Absa Bank Uganda have now partnered with MTN Mobile Money Uganda to launch a new mobile money payment functionality on Absa Point of Sale (POS) machines and terminals. The service allows all MTN Uganda mobile money account holders, to make payments on all Absa POS machines, irrespective of whether they hold an account with the bank or not.
The new functionality can be used at any supermarket, shop, fuel station or pharmacy with an Absa POS machine, thereby allowing customers to pay for goods and services directly using MTN MoMoPay at no extra cost.
POS machines were previously only accessible by customers with bank cards. MTN introduced the MoMoPay service where a mobile money user can pay for goods and services direct from the phone. For this to happen the service provider needed to have a MoMoPay code. Absa has now come on board to expand the service so that service providers without the code but having a POS machine can transact.
Mumba Kalifungwa Absa’s Managing Director thinks that this innovation will further drive cashless transactions and the benefits that come with it. While announcing the partnership, he noted that the new system will enhance access to formal financial services thereby supporting and extending financial inclusion.
“This is yet another digital innovation from Absa as we accelerate our ambition to become a digitally led bank. I urge our customers who are in possession of these machines to provide this payment option to their customers. It not only offers convenience but also has a direct benefit to businesses that do not need to hold onto large amounts of cash waiting to be banked at the end of the day, and in turn mitigating security risks,” Kalifungwa says.
His view is supported by Wim Vanhelleputte, the Chief Executive Officer of MTN Uganda, who stated that cashless transactions are the future given the trends and increased mobile phone coverage in the country.