BoU Deputy Governor commends Centenary Bank for accelerating digitalization of services

“Centenary Bank has played a part in this domestic acceleration of digitalization and the launch of its Mastercard Platinum debit card is only the next evolution of its digital channels,” said Bank of Uganda (BoU) Deputy Governor Dr Michael Atingi-Ego

Dr Anti-Ego was speaking during the launch of Centenary Bank’s Platinum Mastercard debit card on November 29, 2021 at the Kampala Serena Hotel.

He noted that Card and contactless payments are popular for obvious and subtle reasons; they are cleaner than using cash, cheaper than wire transfers, quicker than using cheques, and, obviously, not as risky as sending cash via the post office or on a bus.

“On the subtle side, psychologists and behavioural economists have observed a phenomenon called “pain of paying”i.e., the handing over of money feels like losing money. The pain of paying is stronger when paying with cash than with a credit or debit card. Therefore, promoting card payments is one way to stimulate spending, which is good for economic activity,” the Deputy Governor said.

He added that card payment is also good for Mastercard, which collects fees on transactions and is good for Centenary Bank because it spends less on cash handling and process. With the Platinum debit card, Centenary Bank will also enrich its value proposition to esteemed clients through value-added services, hence building loyalty.

“Much as this card might not have a universal appeal, it shows increasing confidence in the power of digitalization for service delivery by an otherwise conservative bank. A distinguishing feature of Centenary Bank is its strategic focus on unlocking the power of financial services for the underserved in rural areas,” he said and noted that it is a noble cause to focus on the financial inclusion of those at the bottom of the pyramid, not least because 39 percent of Ugandan households remain stuck in subsistence production outside the money economy.

He challenged Centenary Bank to do more and go beyond reaching the rural and underserved (esp. the poorer households and microenterprises) to transform their access to financial services by discreetly leveraging their digital payment data to overcome their lack of collateral.

“Data has been called the new oil. And in the words of Ms Izabella Kaminska, a Financial Times journalist, “Payment data is probably the best quality oil in the business. Payment data is a comprehensive record of how you spend and live your life. There’s no cheating. It explicitly tells when you are most likely to spend, how much, and how frequently.”

He challenged Centenary Bank Managing Director Fabian Kasi to ensure that poorer households and MSMEs are turned into bankable clients. “Mr Kasi, I do hope that you will accept my challenge to extend your current outreach using

digitalization and to turn the poorer households and MSMEs into bankable clients by harnessing their electronic payments data; all “in accordance with the law.”

Noting that every opportunity comes with risk, Dr Atingi-Ego urged Centenary Bank to enhance risk management frameworks to contain the risks that are inherent to digital financial and payment services, such as cyberattacks, outages, technical glitches, fraud, and faulty algorithms.