Postbank, MTN Uganda and Airtel Uganda have defended the Shs2.8bn they charged Government to send relief money to vulnerable Ugandans affected by the 42-day lockdown, arguing that the cost would have been higher hadn’t it been for a decision to reduce cost.
The team made the remarks Thursday while appearing before the joint Public Accounts Committee (Central and Local Government) that is investigating the criteria used in giving relief aid to the beneficiaries whose source of livelihood was affected by the 42-day lockdown.
This was after Hillary Kiyaga (Mawokota South) asked if there was any attempt by the Government to have the cost of transaction reduced.
“How much did for example MTN get in terms of administrative costs and in such a critical moment, did the Ministry team put into consideration bargaining and if they did, was the social responsibility aspect put into consideration? Kiyaga Asked.
Julius Kakeeto, Managing Director Post Bank told parliament that although Post Bank charges Shs3000 on the bank to wallet transactions, the bank charged Shs1000 and having conducted 488,272 transactions, the bank has been in position to make Shs487M and this isn’t inclusive of the Shs2,425 charged on withdrawal and tax for each beneficiary collected by Telecoms.
“As Post Bank, what we call Bank to wallet we charge Shs3000 normally, and when we engaged as a social cause…, we agreed we shall charge Shs1000 instead of Shs3000 and we have carried out 487,307 successful transactions, you multiply that by Shs1000 that is Shs480M,” Kakeeto said.
Andrew Rugamba, the MTN Mobile Money CEO also explained that the charges were one of the key issues that were discussed in meetings with Prime Minister Robinah Nabbanja. He said that there was a logic behind the Shs102,425, so that when a person withdraws the money, they receive a net of Shs100,000.
“The Government of Uganda paid the 0.5 per cent tax on withdrawals and the charge of withdrawing Shs100,000 which is the same for MTN and Airtel is Shs1,925. We agreed in the spirit of the moment that the country was going through, we both zero-rated the fee for disbursement which is ordinarily 300 Shillings,” Rugamba explained.
He added that the withdrawal charge remained because the mobile money agents are also Ugandans and depend on commissions.
