Technology is impacting our lives in ways which we could never have imagined. You probably spend most of your work day in front of a computer working emails, presentations, spread sheets and whatever software tool your business operates. You are probably one of the one billion people who use Facebook and WhatsApp to communicate with friends, family and business.
If you’re more advanced, you’re using tech to track your health, monitor your home and get directions to where you’re going.
You have also probably done mobile payments using mobile money with services like MTN Uganda Mobile Money and Airtel Money have conducted online payments with your credit /debit card.
This trend of technology working to make our lives “easier” and getting us more connected is going to continue. These are some of the trends we see happening in electronic payments industry in Uganda, Kenya and other emerging markets in the near future.
#1. Mobile phones and mobile wallets
Ugandans are already transacting over one million times in day using their mobile phones. In fact Uganda and our neighbors Kenya and Tanzania have the most sophisticated and successful mobile money deployments in the entire world. The rest of the world is grappling with inefficient card system of payment.
With increased mobile network penetration and mobile phones becoming more ubiquitous, mobile phones will become the de facto method of transacting in Uganda and other emerging markets.
#2. Convergence of Mobile wallet and Banks
Most banks offer some sort of online web banking, but this is not optimized for mobile. Bank of Africa has released a powerful mobile banking application that allows you to do a lot of banking functions on your mobile phone. This trend will continue with many others banks releasing mobile apps and /or partnering with mobile wallet providers like MTN and Airtel. This means that you will be able to do things like withdrawing money from ATM without a card, getting loans, making payments and lots of other banking functionality on your mobile phone without visiting your brick and mortar bank branch.
#3. A more cashless society
90% of these transactions on mobile money are peer to peer (ie. Person A sending money to Personal B). The other 10% is used to pay for goods and services e.g. utility bills, television subscriptions, buying airtime, gaming etc.
In the next few years we should see payments moving beyond peer to peer so that you can go to a super market, get a taxi ride, pay concert tickets etc. using your mobile money and other variations of it leading to a more cashless society. The challenge here is to make mobile payments as simple to use as cash
#4. Changes in regulation
As more and more people start to use their mobile phones and wallets to make payments issues of privacy, security and safety will arise. Our regulators will need to awaken from their slumber and mini skirt discussions to enact laws that should not stifle innovation but protect consumers and businesses in the mobile payments sector.
One such regulation is the agency banking act that will allow banks to do banking outside of banking halls – this may actually spur growth of a banked population in Uganda.
#5. The rise of electronic /cryptographic currencies
Electronic currencies or money like Bitcoins are generated and managed using complex mathematical algorithms and the internet.
This might sound geeky, but these currencies are gaining traction and even big internet companies like eBay and Tesla motors accept Bitcoins as a method of payments. As these currencies become more main stream, we expect to see Ugandans to transact more with electronic currencies.
Editor’s note: This is a guest post from Allan Rwakatungu. Allan is the Founder and CEO of intelworld (www.intelworld.co.ug) , a company that develops mobile commerce solutions that enables customers to transact using their mobile phones. If you are an industry player and have an insightful post on topics that could be interesting to the readers of this publication, please don’t hesitate to email editorial(at)dignited.com.