KAMPALA -FITSPA asks Fintech companies to embrace gov’t regulations for their own safety and better service delivery
The Financial Technology Service Providers Association (FITSPA) Chairperson Peter Charles Kawumi has requested Financial Technology (Fintech) companies to embrace government regulations for the good of the sector.
Kawumi who was addressing members of the association on Tuesday during the 4th Annual General Meeting which was held via Zoom, said Fintech firms will leverage on the regulations to attract investors who will boost the industry by investing in more money. He says this will create opportunities to many upcoming or developing Fintechs.
Currently Uganda is experiencing rapid growth of technology innovations in financial services. These innovations such as Mobile money payments infrastructure, M-cash, Pay way have disrupted the financial intermediation space and their existence has been largely felt by society.
And because of their emergence, government passed the National Payment Systems Act 2020, purposely to regulate payment systems and issuers of electronic money.
The law basically focuses on payment service providers, operators of payment systems (electronic money, and payment instalments) with the goal of promoting safety and efficiency of the systems so as to foster economic growth and financial stability as well as provide a framework for oversight (risk-based approaches).
According to Kawumi, other more laws are coming up very soon and it’s from that point that he has asked members to prepare for the good shakeup since it’s coming for the good of the industry.
“You very well know that we have another regulation storm which is just around the corner. And many of you know that this is going to be a very good thing in our industry because it will attract investors who are seeking to enter and support our industry players, however, it’s something that is going to destabilise us in a short time as we seek to be compliant,” Kawumi said.
He went ahead to ask the association members to continue supporting the board as they engage with the regulators to ensure that whatever regulation is put in place is fair for every player in the industry.
“We pledge to continue creating a unified way for the ecosystem and we are working extremely closely with the Central Bank, Ministry of ICT and National Guidance, the Ministry of Finance Planning and Economic Development, UCC, NITA Uganda and insurance Regulatory Authority. We are working with all these based on initiatives that are completely different but aiming at positive out comes,” he said.
Kawumi added the since FITSPA has started being recognized by pillars of the financial sector, there is a need to operate in the law and fully structured formulae.
“We have also started being recognized by the banks. Also at the start of the year, FITSPA was invited before Parliament when they were discussing the National Payment Bill and out this meeting, the President assented to it. We have also held a meeting with the Central Bank on the same bill and the bank pledged to ensure that many of our recommendations are honoured. We also expect them to come back to us with feedback in two weeks’ time. Therefore, all these regulations are for our good and the government so let’s be ready to embrace them as FITSPA,” he said.