Customer perspective is an important factor often overlooked when formal financial institutions plan the delivery of financial services, especially through the agent banking channel.
Coffee is Uganda’s top foreign exchange earner, contributing up to 20 percent of export earnings and employing about 2.8 million Ugandans (93 percent of whom are small-scale farmers owning an average of 0.33 hectares each, where coffee is intercropped with subsistence products).
The Mobile Money for the Poor (MM4P) Uganda programme commissioned research on three agro-value chains: coffee, dairy and fish. Uganda has an overall water cover of 18 percent, and has active fishing in the Albert, Edward, George, Kyoga and Victoria lakes; in the Kafu, Nile and Olweny rivers; and in 160 other water bodies. However, this note focuses on research conducted on the fish value chain at seven Lake Kyoga fish landing sites.
Uganda experiences the favourable climate that is necessary for tea growing. Tea growing was introduced during the colonial days, and by the mid-1950s, tea production and export had made tea Uganda’s main estate crop. Today, tea is Uganda’s second largest foreign export earner (after coffee), with over 21,000 hectares of land dedicated to its growth and harvest. The tea sector produces over 10,000 metric tons of tea per annum, about 90 percent of which is exported.
Dairy farming represents 9 percent of agricultural GDP and about 3 percent of total GDP in Uganda. Uganda’s dairy sector has registered commendable growth, averaging 8 to 10 percent since 1991, and continues to grow.
Digital financial service providers across Africa and Asia typically build their DFS deployments from major urban centres, based on the assumption that these centres have a literate population with sufficient income to benefit from DFS.
Mobile money is a payment and storage service that uses ‘e-money’. This note focuses on mobile money services provided by non-banks, such as a mobile network operator. In this non-bank model, customers exchange cash for e-money at an agent. The e-money, once acquired, is stored on the server of the phone company.
The primary role of a financial regulator is to maintain the safety and soundness of a financial system. However, financial regulators are now embracing financial inclusion as a new goal in recognition that healthy financial systems should serve the needs of the majority of the population.
Digital financial services provided by banks and mobile network operators through agents can help advance financial inclusion by overcoming access barriers to traditional bank branches in developing countries. Agents in developing countries play a pivotal role in facilitating DFS. It is necessary to understand where liability rests in the principal-agent relationship in the event of disputed transactions.
Mobile money is a payment and storage service that uses ‘e-money’ which is a form of stored value that is not a bank deposit. This briefing note focuses on mobile money provided by non-banks, such as a mobile network operator.