Capital Markets Authority, Uganda Securities Exchange Launch e-purchase of Treasury Bills and Bonds

Capital Markets Authority (CMA) and Uganda Securities Exchange (USE) have launched an e-purchase of Treasury Bills and Bonds at the close of the World Investor Week 2024.

The e-purchase of treasury bills and bonds using the USE Easy Portal was officially launched Friday, October 25, 2024, at Serena Hotel in Kampala during the Capital Markets Round Table by Hon. Henry Musasizi, Minister of State (General Duties), Moses Ogwapus, Commissioner in Financial Services Department at Ministry of Finance, Josephine Okui Ossiya, CMA Chief Executive Officer, Hon. Nathan Igeme Nabeta, Chairman of Smart24 TV and USE CEO, Paul Bwiso.

The Easy Portal’s e-purchase of treasury bills and bonds makes it accessible to anyone with MTN Momo and Airtel Money to buy government securities for as low as Shs100,000.

Speaking at the event, Minister Musasizi emphasized the embracing of technology in financial markets citing Project Okusavinga being implemented by Bank of Uganda to enable retail investors to invest in government securities using mobile phones in small transactions.

“It is crucial to acknowledge that Uganda’s journey toward economic transformation is closely tied to the vibrancy of its capital markets. These markets play a crucial role in converting savings into investments that create jobs and enhance our economy,” he noted.

He said that the Capital Markets Authority (CMA) and the Uganda Securities Exchange (USE), through their dedication to promoting financial literacy and investor protection, have been instrumental in fostering a culture of saving and investment in Uganda.

“Their efforts, especially through the World Investor Week, have demystified capital markets for retail investors, expanding access to financial services and advancing financial inclusion.”

Uganda is pursuing an ambitious strategy to achieve a ten-fold increase in GDP by 2040. The Fourth National Development Plan (NDP IV) prioritizes sustainable industrialization as a key driver of inclusive growth, employment, and wealth creation.

According to Musasizi, to finance this ambitious agenda, NDP IV recognizes the vital role of capital markets. “Expanding access to financial services is also critical for mobilizing domestic savings and directing them toward productive investments. NDP IV emphasizes leveraging technology to reach underserved populations and empower them to participate in the formal financial system.”

In her speech, CMA CEO Ossiya said financial inclusion is a critical driver of economic growth, poverty reduction, and social development. “Technology, with its power to democratize access and reduce costs, offers a promising avenue for achieving this goal.”

She said this will allow the capital markets to provide the necessary support to the government to achieve the necessary 40% savings to GDP ratio as compared to the current 2.1% for the current Assets under Management for the Collective Investment Schemes to GDP.

“The advent of digital technologies has revolutionized the way we live, work, and interact. In the financial sector, technology has enabled the development of innovative products and services that are more accessible, affordable, and efficient. Mobile banking, digital payments, and online investing platforms are just a few examples of how technology is transforming the financial landscape.” 

The Uganda Bureau of Statistics reported that there is a total of 45.9 million persons from the recently concluded population census while the Uganda Communications Commission reported that Uganda has a total of 37.8 million telephone subscribers (as of March 2024).

“If we assumed each telephone subscriber accounts for only one Uganda, this would imply that 82% of the Ugandan population can have access to various investment opportunities through the use of the mobile phone, whether a smart or a dump phone,” she noted.

She added: “It is sad to note that as of June 2024, only 253,275 Securities Central Depository accounts have been opened and 92,165 Collective Investment Accounts had been opened. If we are to compare this with the potential reach through mobile phones, as the capital markets we still have a long way to go.”