Have you ever spent a day without spending any physical paper money? Okay, maybe not the entire day—we ain’t there yet. Gotta pay the boda guy, clear some stuff at the shop, but it’s not entirely far-fetched to go a whole day without using paper money. While we’re still miles away from countries like America, where cashless transactions are the norm, Uganda has made significant progress, in my view at least. I mean, there was a time when no one trusted mobile money and yet today, every Ugandan with a SIM card registers for it immediately (even if they only have 200 shillings on there to keep the account alive). Even boda boda transport now has cashless with that SafeBoda Cashless option! If you’re going far enough, any boda will accept a mobile money transfer too. Businesses now have MTN MoMo and Airtel Pay—so that’s sorted too. And with a bank card, you can pay for many services online. But as Uganda pushes towards a fully cashless economy, are we really ready for it?
The Cashless Economy So Far.
True, Uganda has come a long way when it comes to digital payments, and Mobile money has taken lead on this–allowing millions of us to send and receive money, pay for services, and even save without needing a bank account( although I have never managed mobile money saving, I always end up using the mobile money for data and airtime, lol!). In fact, mobile money transactions in Uganda are worth trillions of shillings every year, proving just how deeply embedded the system is in our financial culture.
Even businesses, both big and small, are now accepting cashless transactions–many supermarkets, gas stations, and online vendors now accept digital payments via the afore mentioned MOMO and Airtel Pay services, Visa, and also Mastercard. Government agencies are also pushing for e-payments, with services like URA tax payments, water, and electricity bills now payable via mobile money and banking apps.
And then there’re digital wallets, online banking, and fintech innovations, it feels like Uganda is heading towards a cashless future. Your bank probably has an app that handles your banking, platforms like Chipper Cash are also there for the wallet users, then there’s the MOMO app and Airtel App…but just how smooth is this transition?
Are We Ready to Go Fully Cashless?
1. Infrastructure Challenges
For a country to be fully cashless, there needs to be a strong and reliable digital infrastructure, and let’s be real—our internet can sometimes ghost us just when we need it most, just recently the government lost huge sums of money via a digital transaction and not to mention poor network coverage in rural areas making mobile transactions unreliable. In fact, here in Uganda we sometimes buy a data bundle, then turn the airplane mode on and off just so the new data can start running, thus, people still prefer the good old “cash in hand” approach. Plus, not everyone owns a smartphone, and without one, some digital payment methods remain out of reach.
2. Cybersecurity Concerns
Cashless transactions are convenient, but they come with risks. Fraudsters and hackers are getting smarter by the day, and Uganda has seen its fair share of mobile money scams. Many people have lost their hard-earned cash to fraudsters who trick them into revealing their PINs, miracle money-winnings that turn out to be fake, or even the age old purchase scum where you pay for a product that never gets delivered. Without robust cybersecurity measures, the fear of losing money digitally makes some people skeptical about going fully cashless.
3. Cultural and Economic Barriers
Let’s not forget that cash has been king in Uganda for generations. Many people, especially in the informal sector, still prefer handling physical money. Markets, local shops, and street vendors largely operate on cash transactions, even landlords still demand rent in cash, and some employees prefer getting paid in envelopes rather than bank deposits. Changing this cash culture will take time as we get used to the digital side of things.
Additionally, the cost of digital transactions is a turn-off for many, the withdrawal and transaction fees on mobile money? Painful, just recently I lost my 1,700 shikkings on a 50,000 withdraw, now imagine having to withdraw your salary. Some people would rather keep their cash under a mattress than lose a chunk of it to transaction charges, I mean, have you ever looked at your bank charges?
4. Financial Literacy Gaps
For a fully cashless economy to work, people need to understand how to use digital financial services effectively, unfortunately, many Ugandans, especially in rural areas, have limited knowledge of digital banking, online payments, and cybersecurity or even the mobile devices themselves. Without proper financial education, the transition to a cashless economy will leave some people behind with scams and exploitation just getting out of hand.
True, going fully cashless comes with undeniable benefits; for one, it reduces crime—no cash means fewer chances of being robbed, (although I fear for our bu phones on this). It also makes transactions faster, more convenient, and traceable, reducing corruption and fraud. Businesses can manage their finances better, and the government can improve tax collection.
But if Uganda is to become a truly cashless society, we need to address the existing challenges. This means investing in better digital infrastructure, lowering transaction costs, improving cybersecurity, and educating the public about digital finance…which I don’t see happening overnight. But then again, the saying goes “Rome wasn’t built in a night” so perhaps in a near future we will be swiping cards like in the movies and paying for goods and services in the comfort of our homes.
Until then, keep your MoMo balance up, but maybe don’t throw away that wallet just yet.
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