With effective from 2nd November 2020 MTN Uganda reduced the withdraw rates. Subscribers do not need to pay any Mobile Money agent after a transaction. Fees are deducted directly from your phone. MTN did not explain the reduction in fees but the move is expected to shore up its transaction volumes.
For instance, MTN will now charge UGX 13,000 down, from UGX 13,750 for withdrawing between UGX 500,001 and UGX 1,000,000. Those withdrawing between UGX 30,001 and UGX 45,000 will pay UGX 1,300 from UGX1,350 charged previously.
| Min (UGX) | Max (UGX) | Old rates (UGX) | New rates (UGX) |
|---|---|---|---|
| 500 | 2,500 | 350 | 350 |
| 2,501 | 5,000 | 480 | 450 |
| 5,001 | 15,001 | 770 | 750 |
| 15,001 | 30,000 | 970 | 950 |
| 30,001 | 45,000 | 1,350 | 1,300 |
| 45,001 | 60,000 | 1,650 | 1,600 |
| 60,001 | 125,000 | 2,150 | 2,050 |
| 125,001 | 250,000 | 3,950 | 3,750 |
| 250,001 | 500,000 | 7,700 | 7,350 |
| 500,001 | 1,000,000 | 13,750 | 13,000 |
| 1,000,001 | 2,000,000 | 18,500 | 16,000 |
| 2,000,001 | 4,000,000 | 25,000 | 19,000 |
| 4,000,001 | 7,000,000 | 25,000 | 22,000 |
URA attributed this to the “fact that high-value clients withdraw their funds to agency banking.” MTN Uganda revealed to URA that its mobile money transactions had dropped as customers turned to banks to avoid the tax.
“MTN has had a drop of 36% in mobile money transaction values in the first half of the financial year 2019/20. In addition, other clients are adopting the use of mobile money as a mode of payment for services as opposed to withdrawing for cash,” URA said in a report.
Both the tax and the high fees by telecom companies made it too expensive for high-value clients to withdraw mobile money using the platform.
