Mobile Money has become an extremely popular service within Africa; However, the service has taken a heavy blow and been declared illegal within the borders of Uganda.
According to a report via newvision.co.ug, Justice Christopher Madrama, Commercial Court in Kampala, pronounced that Mobile Money Business, operated by MTN, Warid, Uganda Telecom, Airtel and Africell, have been declared illegal.
According to the report, Bugweri County MP, Abdu Katuntu, had filed a petition and declaration to have mobile money regulated under the Financial Institutions Act.
According to Katuntu: “Mobile money services are currently operating outside of the license issued to them by the Uganda Communications Commission (UCC) to operate as Telecommunication companies.”
Katuntu, according to the report, further stated that: “Mobile money operators; MTN, Warid, Uganda Telecom, Airtel and Africell are registered as telecommunication companies, not financial institutions.”
The report revealed that Justice Madrama had agreed with Katunta, and stated that: “Although mobile money is operating as a financial institution, it is not licensed by Bank of Uganda or any other commercial bank.”
“MTN is not a financial institution. It needs to obtain a license from either bank of Uganda or any other commercial bank to carry out financial businesses and operate mobile money,” he said according to the report.
The judge revealed that a person who is not licensed to transact a financial business does so illegally and it is a crime only handled by the Director of Public Prosecutions (DPP).
Madrama however, dismissed the case because it was instituted in a wrong court, saying the plaintiffs should have raised the issue before a tribunal established by UCC to handle such cases.
“We have no jurisdiction to ask Bank of Uganda to license mobile money as a financial institution. Any question as to the breach of license or acting outside a license, are matters that fall within the tribunal,” Madrama ruled.