The need for unlimited access to banking services, financial inclusion, customer choice and competition are driving the banking sector towards Agent Banking. To implement this approach, through a shared platform and agent network management, the Uganda Bankers Association recently launched the Shared Agent Banking System – an initiative that enables connectivity between member banks to enable a bank agent to serve customers of any other member bank.
A number of banks are already connected on to the system including Stanbic Bank, Barclays Bank, Bank of Africa, Diamond Trust Bank, DFCU Bank, Housing Finance Bank and GT Bank, while additional Banks are at different stages of the integration process and securing the necessary regulatory approvals.
Who can be a Commercial Bank Agent?
An agent can be a petrol station, a supermarket, a permanent mobile money agent, a pharmacy, a retail shop or hardware store that is fully licensed and has been existence for one year. This was done that way to minimize duplication of agency networks and increase/maximize points of presence to ensure coverage across the country.
To become an agent, you should hold a business account with any of the banks connected on to the system. Your business should be a registered and licensed business with a physical address, and you should been engaged in a commercial activity for at least 12 months. Note that an agent cannot operate Agent Banking as their only business.
How to apply to become a Bank agent
To apply you simply follow the steps below;
- Visit the bank branch nearest to your business location.
- Respond to questions from the Branch Manager as regards aspects of your business laid out in the Agent Banking minimum standards checklist
- Fill the Agent Application form and attached the required business Documentation
- Application will be submitted to Bank of Uganda for vetting and approval.
The Central bank will look at the following basic requirements;
1. Agent should be a registered and licensed business;
– Registered Sole proprietor;
– Registered Partnerships;
– Limited liability companies;
– Cooperative Societies;
– Microfinance Institutions;
– Any other entity which the Central Bank may deem fit for example payments companies.
2. Agent should have an account in a financial institution licensed by the Central Bank;
3. Has a physical address;
4. Has adequate and secure premises;
5. Has been engaged in a commercial activity for at least 12 months (Agent cannot operate Agent Banking as their only business)
6. Has a good Credit reference Bureau report.
Once you have been approved by the central bank, you will open a Business account for purposes of Agent Banking (if you do not have one) and deposit a specified amount for float purchase and another for Point of sale device security deposit to start operating.
What can an Agent do?
• Cash Withdrawal
• Funds transfer
• Cash Deposit
• Collection of documents.
• Bill Payment.
• Balance inquiry
• Mini Statement
• Loan application approval
• Account opening initiation.
What is an agent not allowed to do?
* Carry out a transaction when the system is down.
* Charge fees directly to customers.
* Undertake cheque deposits.
* Distribute cheque books, ATM cards or PIN mailers.
* Conduct foreign exchange transaction.
* Sub-contract other persons to provide agency banking services.
* Grant loans or advances or carry out appraisal function for purposes of opening an account.