Mobile Money Transactions, The Case for Proper Legal Framework in Uganda.

TABLE OF CONTENT

DECLARATION ..................................................................................................................... ii

APPROVAL BY SUPERVISOR ........................................................................................... iii

DEDICATION ........................................................................................................................ iv

ACKNOWLEDGEMENT ....................................................................................................... v

TABLE OF CONTENT .......................................................................................................... vi

LEGISLATIONS .................................................................................................................... ix

LIST OF ACRONYMS ........................................................................................................... x

CHAl>TER 0 NE .................................................................................................................... 1

GENERAL INTRODUCTION ............................................................................................ 1

1.1. Introduction ...................................................................................................................... 1

1.2 Statement of the problem ................................................................................................... 3

1.3 Objectives of the study ...................................................................................................... 3

1.4 Significance of the study ................................................................................................... 3

1.5 Scope of the study .............................................................................................................. 3

1.6. Hypothesis ........................................................................................................................ 4

1.7. Methodology ..................................................................................................................... 4

1.8 Literature Review .............................................................................................................. 4

l. 9 Chapterization .................................................................................................................... 8

CHAPTER T'VO ................................................................................................................... 9

2.1.0 EMERGING EXPERIENCES OF M-PA YMENTS ................................................. 9

2.1.1 Developed countries ....................................................................................................... 9

2.1 General Enabling Environment ....................................................................................... I 0

2.2 Proposed enabling principles .......................................................................................... II

vi

2.3 Approaches to implementing the principles .................................................................... 12

2.3.1 Principle 1. There should be sufficient legal certainty around the status of electronic

contracting ............................................................................................................................. 12

2.3.2 Principle 2. Customers should be adequately protected against fraud and abuse ........ 13

2.3.3 Principle 3. Regulators should encourage inter-operability, through ensuring (i)

providers have access to payment systems and (ii) consumers are able to switch financial

providers ................................................................................................................................ 14

2.3 .4 Principle 4. Account opening CDD procedures should be risk-based, and not unduly

prejudice account remote account openings by small customers .......................................... 16

2.3.4.1 CDD exemptions for small value accounts ............................................................... 16

2.3.4.2 Guidance for Risk based CDD .................................................................................. 17

2.3 .5 Principle 5: Customers should at least be able to make deposits and withdraw cash

through agents and remote points outside of bank branches ................................................. 17

2.3.6 Principle 6: Adequate provision must be made for the issuance of e-money by

appropriately capitalized and supervised entities which are not necessarily banks .............. 18

2.4.1 Openness and ceiiainty at the early stage ..................................................................... 20

2.4.2 Additive and transformational approaches to banking ................................................. 21

CHAPTER THREE ............................................................................................................. 23

REGULATORY & POLICY ISSUES ............................................................................... 23

3.1 Mobile Money Regulations ............................................................................................. 23

3.2 Review of Bank of Uganda's Guidelines on mobile money ........................................... 23

3.2.1 Are consumers adequately protected? .......................................................................... 23

3.2.2 Regulation 12 provide for Consumer Protection and Recourse .................................. 23

3.3 Mobile Money Agents ..................................................................................................... 28

3.4 Money Laundering Viz Via Mobile Money .................................................................... 31

3.5 Electronic Transcations Act Of2011 Viz Via Mobile Money ........................................ 32

3.6 Conclusion ....................................................................................................................... 33

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CHAPTER FOUR ............................................................................................................... 34

4.1 EMERGING EXPERIENCES OF MOBILE MONEY PAYMENTS ..................... 34

4.2 Developed countries ........................................................................................................ 34

4.4.2 Developing countries: Philippines ................................................................................ 35

4.4.3 Developing countries: Africa ........................................................................................ 36

4.4.3. I South Africa .............................................................................................................. 37

4.4.3. Kenya- M-Pesa ........................................................................................................... 38

4.5 Conclusion ....................................................................................................................... 41

CHAPTER FIVE ................................................................................................................... 42

5.1 Introduction ..................................................................................................................... 42

5.2 Recommendations ........................................................................................................... 44

5.2.1 Bank of Uganda to set up a separate body to monitor mobile money .......................... 44

5.2.2 Financial laws should work together with Telecommunication laws ........................... 44

5.2.3 Control of money laundering ........................................................................................ 45

5.2.4 Proper Legislation to regulate mobile money transactions .......................................... 45

5.3 Conclusion ....................................................................................................................... 45

BIBLIOGRAPHY ................................................................................................................. 46

Websites ................................................................................................................................. 46