Digital Financial Services (DFS) are fast evolving in the parts of the world. The Association of financial institutions in Uganda (AMFIU) has been at the forefront of advocacy, lobbying and ensuring client protection in Uganda. Digital Financial Services (DFS) has captivated the Microfinance Industry in Uganda and key stakeholders and regulators recognize the need for developing guidelines for DFS and ensuring client protection.

Dgital channels are now an effective delivery channel for improving access to and usage of financial services, where the high cost of building and operating traditional bank branches has been a major obstacle for reaching remote, sparely-populated communities. Poor infrastructure and high travel costs make traveling to urban areas unaffordable for many rural people.

While DFS is still in its infancy, it is already being harnessed by financial service providers such as banks, microfinance institutions and mobile network operators (MNOs), who use mobile phones and point-of-sale devices, along with networks of small-scale agents, to offer basic financial services at greater convenience and sometimes at a lower cost than traditional banking.

Branchless Banking
Banks and MNOs are increasing their presence and penetration into remote rural areas through authorized agents and merchant points, where customers can interact with agents (often small or microenterprise owners) to conduct financial transactions such as depositing and withdrawing cash, paying bills and transferring money.

Mobile money
Mobile phones present the greatest opportunity for reaching the financially excluded. Recent significant advances in technology and affordability of mobile technology offers a promising channel to provide access to the formal financial system to the financially underserved, in turn expected to improve living standards and reduce poverty. Mobile money, mobile wallets or e-wallets allow customers to make payments and transfers, save money securely, purchase phone top-ups and more.

AMFIU has been training it’s members and creating awareness among their customers on the opportunities of utilizing technology but this has been done on a limited scope