Mobile money firms to pay Shs50m for annual licences through Telecom companies.

Bank of Uganda has set Shs25m as the amount that telecoms will have to pay in annual licence to operate as a payment service providers or payment systems operator.
The two services are classified separately, which means that a telecom that wishes to operate both will have to pay a combined sum of Shs50m annually.

Telecoms are already operating as payment service providers and payment systems operators, which means they will be required to have the two licences.  The fees are contained in the National Payment Systems Regulations 2021, which effectively split mobile money operations from telecommunication services.

Mobile money has been operating as a service under telecom operations. However, under the National Payment Systems Act, which was passed last year, the service has been split as a standalone business that will be regulated by Bank of Uganda.

The Act also requires telecoms to register new subsidiaries, which has effectively seen MTN place its mobile money business under MTN Mobile Money Uganda while Airtel Money will trade as Airtel Mobile Commerce Uganda.

The Shs25m licence fees, according to the regulations, will apply to companies operating large electronic money issuers whose total trust account value exceeds Shs200b per month while medium funds transfer systems or provider, whose transaction value does not exceed Shs100b per month will pay Shs20m. Small funds transfer systems or providers, whose transaction value does not exceed Shs1b per month will pay Shs15m annually.

The charges, which will be annual, will include application fee of Shs3m for all licence categories.  Last week, Bank of Uganda indicated it had issued payment service providers and payment systems operator licenses to MTN Mobile Money Uganda and Airtel Mobile Commerce Uganda.

The regulations provide for licence categories for larger electronic money issuers, medium funds transfer systems or provider and Small funds transfer systems or providers.

Yesterday, Ms Charity Mugumya, the Bank of Uganda director communications, told Daily Monitor the National Payment System Department at the Central Bank was evaluating other licence applications, among which include UTL, Africel, Mcash, Micropay, Ezee Money and Interswitch, all of which have applied for both payment service provider and payment systems  operator licences.

Other applications under evaluation include Agent Banking Company, Pegasus Technologies and YO Uganda, which are seeking licenses for payment systems provider.
Also under consideration are applications from Xente (payment instrument issuer licence), Payway and Easy Pay, which want to be licensed as payment systems operators.

Minimum capital requirement 
The regulations also indicate that large funds transfer issuers that operate payment service provider companies will be required to have a minimum capital requirement of Shs10b while medium electronic money issuers must maintain Shs5b as minimum capital.  Small electronic money transfer issuers, whose total trust account value does not exceed Shs500m, will be required to maintain Shs250m as minimum capital.

On the other hand, payment systems operators, whose transaction value exceeds Shs100b per month, will be required to have a minimum capital of Shs1b while medium and small operators will be required to maintain minimum capital requirement of Shs500m and Shs100m, respectively.