Uganda Implements New ID Requirement for Large Mobile Money Transactions

Kampala, Uganda — Mobile money agents in Uganda are now required to verify the identity of customers transacting amounts over UGX 1 million, as part of new regulations enforced by the Bank of Uganda.

This directive aims to combat the increasing incidents of online fraud and scams associated with mobile money platforms in a bid to make electronic banking and payment systems safer in the country following a surge in online fraud.

This was revealed in the early morning hours this friday by a local Television through its X (formerly Twitter) handle asking for the thoughts on the new enforcement that will see every Mobile Money agent require a customer to present a National Identity card issued by NIRA.

The Bank of Uganda Confirmed the new measure on social media, stating that the rise in mobile money-related cybercrimes necessitated stricter controls.

The directive is aligned with Section 55(1)b of the National Payments Systems Act, 2020, and Regulation 7 (h) of the National Payment Systems (Agents) Regulations, 2021.

Under these regulations, all high-value transactions ( UGx 1,000,000 upwards ) at authorized agent locations and operator centres on digital financial service platforms must be conducted only after verifying the customer's identity using a valid form of identification.

Acceptable forms of ID include a national ID for Ugandan citizens, a passport, a refugee ID or attestation letter, or an alien ID for foreigners.

The move is designed to enhance the security of digital financial services and protect users from potential fraud by ensuring that all transactions are traceable to verified individuals. The requirement for identity verification at higher transaction thresholds is expected to deter the misuse of mobile money services by unscrupulous individuals and networks of criminals.

This regulatory update follows several reports of increased fraudulent activities where mobile money systems were exploited by agents collaborating with criminals. By enforcing identity verification, the Bank of Uganda aims to curb these illicit activities and strengthen the overall integrity of the mobile money ecosystem in the country.

The implementation of this directive is immediate, and mobile money agents across Uganda are required to comply with the new identification requirements to continue operating legally. This measure is part of broader efforts by Ugandan authorities to regulate and secure electronic financial transactions in a rapidly evolving digital landscape.