The latest launch of the MTN MoKash platform to allegedly offer small loans to their customers begs serious thought before we can celebrate.
In my view, manufacturing, education, health and the financial services.
MTN is one of those foreign companies that appear determined to suck blood out of Ugandans using the ill-advised open and careless economic policies courtesy of the multilateral financial organizations.
The introduction of MoKash sounds like a novel and brilliant idea that is meant to deepen the banking sector through greater inclusion of the unbanked cash. But I beg to differ with this illusion. These initiatives are receiving accolades after the collapse of our indigenous savings and cooperative financial initiatives that directly connected key players of the economy such as banks, traders and processors to financial institutions.
I have no kind words for initiatives such as MoKash because in my view, they are meant to make life harder for ordinary Ugandans through dangling easy borrowing programmes such as this.
The partnership between MTN and cba bank in this venture should be an eye opener to more critical Ugandans. The main point to note here is the arms-length type of regulation that MoKash is using by going through a relatively new bank to channel its lending and borrowing activities. Authorities should know that whereas MTN is controlling a significant amount of people’s savings, they are largely outside the strict supervision of the central bank.
It should be noted that developed countries that preach more open economic policies instead practice the opposite. The USA for instances actually keeps a very firm grip on its local companies such as Facebook, Microsoft as a way of cushioning them from ruthless competition from foreign companies.
Allowing telecom companies to roll-out massive monetary services without the control of the central bank smells danger. I think MTN MoKash is one of the new schemes that are likely to kill the nascent financial sector.
Before you know it, MTN will be encouraging its platform to buy expensive phones on credit and thus promote consumerism rather than promoting more solid economic activities such as farming and regional trade.
The government should liberate and introduce greater regulation instead of leaving it in the hands of predator multinational companies.It is my view indeed that MTN MoKash should fall directly into the armpit of the central bank to ensure greater protection of savers and the broader economy.
Mathias Ssemanda, Kampala
