Uganda may be on track to fully embracing digital transactions

Equity Bank in Uganda reports that only 6% of its transactions take place within its banking halls, highlighting a significant shift towards digital and alternative banking channels.
With technology enabling 94% of transactions to occur outside branches, Equity Bank emphasizes the need for a network, service, and digital banking system restructuring.
Equity Bank expands its agency banking network to over 8,000 agents, processing significant quarterly transaction volumes, while investing in digital banking to cater to unbanked individuals in Uganda.

Uganda's Equity Bank has disclosed that only 6% of its transactions are carried out inside its banking halls. The specifics represent a significant move toward new financial transaction channels, such as agency banking, digital, mobile, and internet banking, among others.

Mr. Anthony M. Kituuka, managing director of Equity Bank, stated that technology has made it possible for the bank to perform 94% of its transactions outside of its branches (halls) when presenting the firm's financial results for the period ending December 2022.

However, at Shs694b, the value of transactions made inside the bank is still bigger than that of digital channels. The managing director noted that the change had made it necessary to restructure the bank's financial network, services, and digital banking system.

Mr. Kituuka stated that throughout the course of the year, the agency banking network of Equity Bank had increased to more than 8,000 agents from 7,727 agents in 2021, processing more than Shs13b per quarter.

He explained that in order to serve more Ugandans without bank accounts, the bank will keep making investments in digital banking.

The first financial institution in Uganda to use an agency banking platform was Equity Bank. It uses a separate platform from Agent Banking Company's common agent platform, which is used by more than 20 banks and has a total of 20,487 agents.

Mr. Kituuka also said that other digital banking channels, such as Eazzy stock financing, have contributed to the development of non-banking transactions. Several banks, including Stanbic, have already said that the change in banking has affected banking hall traffic, which has decreased by more than 80% for most of them.

Because of this, banks have had to make technological investments to take advantage of the transition as well as manage the introduction of new product lines to compete with emerging financial services like mobile money, which have seen rapid development over the past ten years.