Uganda’s nearly 270 registered Forex Bureaus are now having to deal with the running effects of wobbling inflows. Demand and supply from regional markets as well as lower import requirements. “It is very difficult in this trading environment and that is also partly behind what you have seen in the past seven months or so. BOU closing some of the Forex Bureaus.” Said, Stephen Kaboyo – Managing Director, Alpha Capital. A cross section of money exchange points within the city reported that the general dip in business transactions set their margin down by 65% over the past year alone. “Even the traders those who import in goods; they have to buy dollars and buy goods from outside but you find that since the business is low, so they have low inflows and they have less money to buy the dollars so at the end of the day they have less to bring into country in terms of imports.” Said, Ronnie Kiwanuka – Dollar House Forex Bureau.
Money transfer agents on the other hand reported their own structured model of doing business is equally under threat. “To different countries using Money Gram, Western Union, and Express Money; you find that someone who used to buy like 20,000 this time he comes and only takes 10,000. People started up their own transfers using phones.” Said, Violet Kaheru – Manager, Money Transfer (DH). These traders in Foreign Exchange now in part have their hope in new technologies and financial sector reforms going forward. “Like agency banking; that should give us a lot more room for products menu to be able to generate revenue. We have recently been allowed to do mobile money that should also add to our revenue areas. Money transfers; so the diversification of the income or revenue streams will help going forward.” Said the Managing Director, Alpha Capital.
The sector regulator Bank of Uganda revoked the license of more than five bureaus plus the former leading Cranes Forex Bureau. In part what sources claimed was a flagrant violation of reporting conventions including to the Financial Intelligence Authority.
