KATS successfully advised BT Payment Services, a Fintech Digital Money Remittance Services Provider, on the licensing of its operations in Uganda by the Bank of Uganda. Our Alice N. Blazevic, a Partner and Patrick Mugalula, an Associate took the lead on this transaction.
BT Payments Services Limited, a Ugandan financial technology company with roots in Kenya, provides a secure web-based money remittance option that allows the seamless transfer of money from Uganda to various countries including Nigeria, Kenya, Ghana, Tanzania, Senegal, the United Kingdom, the European Union and Morocco in numerous currencies.
The unique value proposition presented by BT Payments Services Limited is that their customers are able to send money in their own currency to recipients in different countries at no extra or additional cost, in a relatively short period. BT Payments is ubiquitous since it is internet based at mybfx.co/ and it has a relatively simple interface that is user-friendly.
KATS advised BT Payments Services Limited on the process of securing regulatory approval to carry out what is essentially electronic money remittance in Uganda. This is a first for Uganda, since the legal and regulatory environment in the country has evolved at a much slower pace than technology, such that the laws in place in Uganda envisage brick and mortar businesses in an era of e-commerce and digitalization of society. The outdated and in some cases obsolete legal regulations in respect to financial services present a legal quagmire for budding fintech businesses looking to invest in Uganda. It is tragic to consider that, whereas there exists technology to enable Uganda, and many parts of Africa at large to close the financial inclusion gap and possibly leapfrog into an era of financial competitiveness on a global scale, these opportunities are hindered by a regulatory gap caused by old or non-existent regulations.
In a major first, the Bank of Uganda breathed life into the 2006-era financial regulations to license BT Payments Services Limited, a digital money remittance services firm providing services exclusively over the internet, through interaction with other secure money transmission media and services. This progressive and tech savvy spirit reared its head in the consideration of BT Payments Services Limited with the regulator, demonstrating forward thinking and innovative regulatory reasoning. The Bank of Uganda placed emphasis on the key aspects of regulatory oversight, monitoring and most importantly customer protection to ensure that the product offered by BT Payments Services Limited was a fundamentally sound one and on establishing that it was, proceeded to license the company.
We commend the Central Bank for its foresight and progressive attitude in the licensing of BT Payments Services and congratulate BT Payments Services Limited on this momentous milestone.
This Fintech alert provides general information only. It is not intended to provide advice with respect to any specific set of facts, nor is it intended to advise on all developments in the law.