Bank of uganda is asking members of the public to stop the habit of hiding money and preventing it from circulation which reduces the velocity of money, a speed in which money changes hands from one person to another.
This was disclosed by the deputy central Bank Govnor Prof Augustus Nuwagaba as he who interacted with Ugandans abroad and in the country during a webinar organized by Equity Bank under the theme Re Routing back home funds transfer for powering personal and continental growth.
Challenges to remittances flows for Uganda.
- The cost of sending remittances is still high due to limited competition and inadequate cross-border interoperability.
2.Global average cost of sending US$200 was 6.4% (or US$12.8) and for SSA was 7.9% (or US$15.8).
These are way above the SDG target of 3% 2. Job-market condition and changes migration policies in the source countries.
- Informal remittance, which are not captured in official statistics affect planning.
- Access to national ID to meet the Know Your Customer (KYC) requirements for accounts opening.
- Compliance with AML/CFT declaration of sources of funds. 6. Information asymmetry and lack of trust .
During the discussion, regional growth was largely attributed to strong remittances where Uganda got 1.4 billion dollars representing 15%, Rwanda 0.5 million dollars representing 9.3 % Kenya 4.2 million dollars representing 2.6%, Tanzania 7 billion dollars, representing 4% growth.
Stability in Sudan was largely cited as a key factor in the trade balance between Uganda and south Sudan which stands at 155 million dollars annaually,a great benefit to the Ugandan economy.
The Deputy govnor says financial inflows from tourism trade and inflows from individuals abroad are important as they help in keeping the stability of the Uganda shilling.
Equity Banks Managing Director Gift Shoho says organising the Nation wide discussion with Ugandans abroad to demonstrate Equity Banks offer of integrated financial services that socially and economically empower consumers.
The Bank has 50 active branches with 2.2 million customers,making it the second biggest bank in Uganda.
“we command quite a significant market share in the economy. And this makes us maybe the bank that has played the most critical role in bringing financial inclusion to Uganda” says Gift Shoho.
In a bid to support and promote African entrepreneurs to go into manufacturing 15% of Equity Banks lending will go to manufacturing.
He has pledged Equity Banks full support to the agricultural sector , ” food and agriculture is our number one pillar and we are saying At least 30% of our lending in any economy that we operate in should be towards food and agriculture” he says.
