Africa Business: Uganda to Investigate MTN

Uganda’s telecommunications regulator, UCC  (Uganda Communications Commission) has said it is setting up a committee to investigate the local unit of South Africa’s MTN (Mobile Telecommunications Network formerly M-Cell) Group after uproar on social media about its mobile money policies, reports Reuters.

This past week dozens of MTN’s subscribers in Uganda took to Twitter to accuse it of making it nearly impossible to cancel a mobile money (a system which enables people to transfer cash and make payments on their cellphones without any bank interference) transaction made in error.

As in neighbouring Kenya, mobile money use has grown rapidly, fuelled by the low penetration of banking services and the inability of many people to access loans or other products from banks.

A spokeswoman for MTN Uganda said the company had internal policies for money sent in error. As long as the money had not been withdrawn at the other end, cash could be frozen after a subscriber informed them of an erroneous transaction. Then after some confirmatory processes, it could be reimbursed.

In the event that the money has already been withdrawn by the wrong recipient, then “the customer would be advised to negotiate with the person [wrong recipient],” said MTN spokeswoman Justina Ntabgoba.

UCC Executive Director, Godfrey Mutabazi said he was setting up an investigation, especially since the South African Telecom giant is in the process of renewing its 20-year licence, which expires in October. Mr. Mutabazi further explained that the complaints and related matters will have to be sorted before the renewal will be completed.

The Twitter criticism was set off  by a university lecturer who tweeted that he had made a mistake while trying to send money to a friend for funeral expenses.

When he called the company and asked for the transaction to be reversed, he was told he needed a court order to claim the money from the recipient.

Interestingly, according to the regulator, nearly all of Uganda’s 24 million mobile subscribers also have a mobile money account and incidentally, MTN happens to be the East African country’s biggest telecom providers, followed by India’s Bharti Airtel.