Four years after Uganda formalized its mobile money regulatory framework, the market has evolved from a two-player telecom game into a sophisticated digital payments ecosystem with 54 licensed entities—and the data suggests the MTN-Airtel stranglehold may finally be loosening.
The Bank of Uganda (BoU) released a comprehensive update on December 3, 2025, revealing a dramatically expanded landscape of payment service providers operating under the National Payment Systems (NPS) Act that came into force in 2021. The legislation ended years of regulatory ambiguity where telecom giants operated mobile money services without formal oversight, creating what many observers described as an uneven playing field for fintech challengers.
What the new data reveals is more than just regulatory housekeeping—it’s evidence that Uganda’s approach to cultivating competition in digital finance may actually be working.
The duopoly cracks open
For the better part of a decade, Uganda’s mobile money story has been simple: MTN Mobile Money dominated with roughly 60% market share, Airtel Money held most of the remainder, and everyone else operated on the margins or gave up trying.
When the BoU issued its first licenses under the new regulatory regime in 2021, only MTN and Airtel qualified for “Large Funds Transfer” designations—the top-tier license allowing high-value transactions and the broadest range of payment services.
The 2025 update tells a different story. Wave Transfer Limited, which entered through the BoU’s regulatory sandbox in 2021, has graduated to Large Funds Transfer status, joining the telcos in the elite tier. Also holding the designation: Onafriq Limited (formerly MFS Africa), Interswitch, and Cellulant—all pan-African fintech infrastructure players with significant regional ambitions.
Perhaps most notable is Chipper Technologies, the operator of Chipper Cash, which now holds both Large Funds Transfer and Class A Card Issuer licenses. The San Francisco-based, Africa-focused fintech has raised over $300 million in venture funding and operates across multiple African markets, but licensing in key jurisdictions like Uganda has been critical to scaling its cross-border payments and P2P transfer business.
Sandbox to scale: validation of a model
Wave’s progression from regulatory sandbox participant to top-tier license holder offers tangible evidence that Uganda’s approach to fintech regulation—balancing oversight with innovation—can work.
The Senegal-founded, U.S.-backed mobile money operator has been on a tear across francophone West Africa, where it’s challenged incumbents like Orange Money and MTN by offering zero-fee person-to-person transfers and undercutting traditional mobile money pricing models. Wave’s 2024 Series B funding round reportedly valued the company at $1.7 billion, making it one of Africa’s most valuable fintech startups.
Its graduation to Large Funds Transfer status in Uganda suggests the BoU’s sandbox isn’t just a public relations exercise but a functional pipeline for vetting and scaling new entrants capable of competing with entrenched players.
“The sandbox mechanism allows innovators to test products in a controlled environment while building the operational maturity and compliance infrastructure required for full licensing,” one payments industry analyst noted. “Wave’s trajectory shows that pathway is real.”
Beyond mobile money: ecosystem stratification
The expansion to 54 licensed entities reflects more than just new mobile money operators entering the market. The BoU’s updated list reveals ecosystem stratification: specialized switches, card issuers, payment aggregators, and infrastructure providers each occupying distinct regulatory categories.
This mirrors patterns seen in more mature digital payment markets like Kenya, where M-Pesa operates alongside dozens of licensed entities providing complementary services—payment gateways, merchant aggregators, remittance corridors, and cross-border settlement infrastructure.
Uganda’s market is evolving toward similar complexity. Interswitch, a Nigerian payments giant processing millions of transactions daily across Africa, holds multiple license categories in Uganda. So does Cellulant, a pan-African digital payments platform that powers merchant checkout experiences and bill payments for major corporations.
The diversification suggests Uganda’s digital payments infrastructure is maturing beyond simple mobile wallet transfers into a layered ecosystem supporting e-commerce, digital lending, cross-border remittances, and merchant services.
What about the incumbents?
MTN and Airtel aren’t standing still. Both have invested heavily in expanding agent networks, introducing merchant payment solutions, and integrating mobile money with broader financial services offerings like savings, insurance, and credit.
MTN Mobile Money Uganda processed over 6 trillion Ugandan shillings (approximately $1.6 billion) in transactions during 2024, according to company disclosures. The service remains deeply embedded in Ugandan daily life, used for everything from boda-boda (motorcycle taxi) fares to school fee payments to salary disbursements.
But the regulatory changes mean MTN and Airtel now face competition from well-capitalized fintech challengers that can offer specialized services, better pricing, or superior user experiences in specific segments—cross-border payments, merchant services, or youth-focused P2P transfers.
The question is whether licensing Wave, Chipper, and others as Large Funds Transfer operators will meaningfully shift market share, or whether network effects and habit will keep the telcos dominant despite increased competition.
Regulatory ambitions meet market realities
Uganda’s approach stands in contrast to some African markets where regulators have been slower to formalize mobile money oversight or more restrictive in granting licenses to non-telco players.
Kenya’s mobile money regulatory framework has been in place longer but has faced criticism for high barriers to entry. Nigeria’s central bank has oscillated between encouraging fintech innovation and imposing sudden restrictions that blindsided operators. Tanzania’s regulatory environment has been described as unpredictable.
Uganda’s 54-entity licensing roster suggests a deliberate strategy: formalize the market, create clear pathways for new entrants, and let competition drive innovation and financial inclusion.
Whether that translates to meaningfully lower costs, better services, and deeper financial inclusion for Uganda’s 47 million people remains to be seen. Mobile money penetration in Uganda stands around 60%, with millions still unbanked or underbanked, particularly in rural areas.
What comes next
The next phase will test whether regulatory structure can overcome network effects. MTN and Airtel benefit from ubiquitous agent networks, brand recognition, and years of customer habit formation. New entrants must either replicate that infrastructure—expensive and time-consuming—or differentiate through superior technology, pricing, or user experience.
Wave’s zero-fee P2P model has disrupted markets elsewhere; whether it gains traction against Uganda’s entrenched players will be a key indicator. Chipper’s cross-border focus could carve out a niche serving Uganda’s diaspora communities and young, mobile-first users.
Interswitch, Cellulant, and Onafriq bring pan-African infrastructure ambitions, positioning Uganda as a node in regional payment networks that could eventually enable seamless transactions across East African Community member states and beyond.
For now, Uganda’s mobile money market looks more competitive on paper than it has in years. The real test is whether 54 licensed entities translate to meaningfully better outcomes for the millions of Ugandans relying on digital payments to navigate daily economic life.
