Yo! Uganda Limited is currently enabling Financial Institutions to reduce costs by accepting deposits from their customers directly from their Mobile Money wallets and transmitting withdrawals directly to their Mobile Money wallets.

We can speak of branchless banking advantages from two perspectives: the customers and service providers.

Business perspective:
Investing in cashless banking can bring a huge payoff for the business. Branchless solutions don’t require investing in building and supplying new bank departments. Therefore, they are not so high-priced. A bank can invest saved resources in developing new products, additional digital services, or improving existing ones.

Branchless banking facilitates reaching out to new customers from various, sometimes hard-accessible locations. Thus, not only can a bank save money, but at the same time welcome more clients into the fold.

Investing in branchless banking solutions can keep your business ahead of the competition. As the world is moving forward – banks should too. To stay relevant in the financial market, it is essential to follow current trends and respond to new, every time more exacting needs of your clients.

Customer perspective:
Customers can enjoy seamless transactions that can be performed from any place in the world as long as they have a good internet connection. Whether you are a city businessman or a rural area locator – the way you bank can be much more convenient.

Online banking services are usually easy and intuitive. What was a complicated process can now be completed with a few taps on the phone screen. Thus, even if you don’t feel too confident with digital apps, you should be able to learn in no time how to master them.

Branchless banking gives customers the convenience of transacting using multiple avenues such as voucher less top-up, loan settlements, cardless withdrawals, cash deposits, money transfers, tax and bill payments, etc. Financial institutions that rely on biometric verifications should be cautious in times of outbreak. And branchless banking resolves this issue by using OTPs and sharing virtual transaction receipts with customers via email or SMS.

Conclusion
There is no doubt that virtual banking has revolutionized the financial industry, and it is going to develop even further in the future. Innovative distribution channels with the perspective of customer convenience are going to emerge. Because of this, the operators will soon compete with each other for their space in the next-level agency banking space. The future looks extremely promising!

FinTech industry overview
Fintech is a portmanteau of the terms “finance” and “technology” and refers to any business that uses technology to enhance or automate financial services and processes. The term encompasses a rapidly growing industry that serves the interests of both consumers and businesses in multiple ways. From mobile banking and insurance to investment apps, FinTech has a seemingly endless array of applications.

The industry is huge — and will continue to expand for years to come. One driving factor is that many traditional banks are supporters and adopters of the technology, actively investing in, acquiring or partnering with FinTech startups because it is easier to give digitally-minded customers what they want, while also moving the industry forward and staying relevant.

We have classified the benefits that set FinTech businesses apart into four categories:

1. Speed
In today’s fast-paced world, waiting for an international payment to go through, or for a bank to grant a loan can sometimes take what feels like forever. That is why FinTech companies rely on efficiency to set themselves apart. Where traditional banks rely on age-old processes and multilayer checking, FinTech innovations such as the use of algorithms, artificial intelligence, and automation work towards speeding up processes. The advancements of FinTech make it possible to process applications and approvals much faster than traditional banks, which results in a better overall user experience. But speed also means accessibility and another benefit of FinTech is its convenience.

2. Convenience
The COVID-19 pandemic has contributed to the rapid rise of FinTech. Given FinTech companies heavily rely on the Internet and mobile connectivity, they came out as one of the big winners of the pandemic. Their high level of connectivity allows them to reach a wide audience and allows their audience to reach them at the touch of a button. The flexibility they offer in terms of time and location makes them entirely adaptable to their clients’ needs. While traditional banks tend to rely on in-branch appointments that demand patience on the part of the client, some FinTech firms use chatbots, making them easily accessible 24/7 and in many languages. Today, customers look for convenience in every aspect of their lives and FinTech firms have learned to meet this need far quicker than traditional banks.

3. Transparency
Today’s consumers are wary of unexpected fees which is why FinTech firms believe in laying out all their cards upfront. When it comes to payments, transparency also means better visibility regarding payment timeframes and the progress of transactions. Today, people are used to track where things are, whether it’s parcels or food. Naturally, they expect the same level of transparency from their banks.

4. Price
Whether it’s currency conversion rates, processing fees, or commissions, FinTech businesses know that users today are particularly attentive to costs. That is why they offer payment solutions that include as few extra costs as possible and a competitive overall price. FinTech innovations often make it possible to offer lower prices to consumers and businesses compared to traditional banks. Having better visibility of the various costs incurred may represent considerable savings for a company.

Conclusion
The future of FinTech is bright. While the benefits of FinTech have never been so evident, partnerships between FinTech businesses and banks are the most likely outcome for the future and offer the best of both worlds. Fintech brings flexibility, agility, and innovation while conventional banks, as well-established, trusted institutions, provide a stable environment and can make use of vast amounts of customer data. With conventional banks able to provide a sound and trustworthy environment, and FinTech firms banking on their niche expertise, the financial service landscape of the future will undoubtedly require the two industries to work hand in hand.

What do FinTech companies do?
FinTech is the abbreviated form of Financial Technology is a range of financial services software that is used by companies to automate traditional financial methods. For instance, for us as Yo! Uganda Limited, our services include merchant payments, bulk payments, branchless banking, mobile banking, mobile VAS, and custom software development.

How FinTech Companies Help a Startup Grow?
FinTech companies develop technologies that allow business owners to manage and control actions like accepting payments, paying bills, and using other financial services to their advantage. Earlier with the lack of these technologies and other facilities provided by FinTech, startups didn’t have many ways to grow their businesses.

Furthermore, they only had banks as a source of capital which was used to look for the credibility and the scope of these companies in the future market. This made the process more complex and difficult for a company that is in its initial stage. With the FinTech solutions in the market, startups now have more options and ways in which they can work towards growth.

Importance of FinTech Companies
However, it is hard for startups to grow and make a reputation in today’s world with all the competition and a large number of startups launching every year. Hence, it is important for them to opt for ways that bring ease to their functioning and help them grow effectively/efficiently. FinTech companies play a major role in this. Mentioned below are some of the importance of the presence of FinTech solutions in the (modern) market;

• Anyone having an internet connection can access FinTech solutions all over the world
• FinTech solutions are comparatively cheaper than their counterparts
• Moreover, the usage of various technologies makes the process in a company automated
• Furthermore, these systems are flexible in nature as they do not demand too many documents and they provide lending to new and very small businesses
• Also, the use of modern technologies adds to the reason startups choose them
• Henceforth, FinTech companies provide a better customer experience

Conclusion
FinTech companies ease the process of managing a business by using automation technologies, less documentation, providing lending, expense tracking and invoicing, usage of various tools, and by providing a range of FinTech products and services. These services help startups to grow.

One of the industries most heavily impacted by the COVID-19 pandemic was hospitality and tourism. After years of steady growth, the pandemic’s travel restrictions and quarantine measures caused these sectors to face a decrease of 73% in arrivals between 2020 and 2021. The World Tourism Organization recognized 2020 as the worst year in tourism history. The hospitality industry was hit hard. Millions of people who depended on the tourist influx were left without a source of income.

One thing for sure is that FinTech remains pivotal in helping reduce costs while continuously elevating the customer experience. Here are a few points to note:

• Fintech can solve the expense headache: Fintech-enabled solutions can have a positive impact on the future of business travel, aiding organizations that currently deal with monitoring and reducing expenses. Fintech automation can drive cost savings while also increasing productivity among employees.

• Fintech can solve the expense headache: Fintech-enabled solutions can have a positive impact on the future of business travel, aiding organizations that currently deal with monitoring and reducing expenses. Fintech automation can drive cost savings while also increasing productivity among employees.

• Fintech can solve the expense headache: Fintech-enabled solutions can have a positive impact on the future of business travel, aiding organizations that currently deal with monitoring and reducing expenses. Fintech automation can drive cost savings while also increasing productivity among employees.

Conclusion
The changing expectations of end-users at a time when the travel industry is bouncing back from unprecedented restrictions means operators and agencies need to understand the importance of adopting the latest FinTech solutions. With the help of a trusted payment partner, travel and hospitality businesses have a unique opportunity to apply the most efficient FinTech solutions to minimize cart abandonment, enhance conversion and provide a frictionless payment experience.

Massive innovation also happens in the finance sector, including payment systems whose recent innovation is in the form of digital payments. With such a platform, people no longer need to pay using cash or a card. Payments can be made by only using a cellular/internet connection and a smartphone, known as a cloud- or server-based payment system. This system has several advantages over electronic money–based cards; it can store data and transaction records over the internet (cloud-based). If the sim card or hand phone used as an e-wallet is lost, the electronic money stored in it is not necessarily lost as long as access to the sim card is regained. If the money-based electronic card is lost, then the electronic money stored cannot be obtained again.

Digital payments have immense potential to be widely used in Uganda as over 40 million people in the country, 49% of whom have smartphone or tablet devices that use the internet. Furthermore, the majority (12.169%) of internet users in Uganda are between 19 and 34 years, generally technology literate, and highly mobile (Data Reportal)). Such a high potential market has encouraged the perpetrators of the financial industry to innovate to meet the needs of consumers who require payment systems to be more efficient, practical, instant (one-touch payment), and secure. Digital payments also have a wide room to be used in Uganda as the majority of its society still relies on cash in making payments.

In Uganda, the majority of retail transactions are still paid in cash, leaving the country behind its neighbors in Kenya and Tanzania.

Furthermore, digital payments do not only benefit individuals but also positively affect the development of micro-, small, and medium-sized enterprises (MSMEs). Below, we have pointed out some benefits to MSMEs of digital payments systems:

(i) Safer and faster payment. Digital payments can reduce transaction costs as paper-based payment involves manual processes and takes many steps to complete.

(ii) Better customer experience. Unlike paper-based payment that requires customers to bring cash everywhere, with an e-wallet, they only need to bring their mobile phone. It is more convenient for customers as making payment takes only one click. Customers also do not have to provide several denominations to pay an exact amount; sometimes getting small denominations of money is quite cumbersome.

(iii) Increased transparency and well-managed bookkeeping. Every payment transaction using digital payments is automatically recorded on the server. Therefore, without manual recording, MSMEs can access their transaction record and have neat and accurate bookkeeping.

(iv) Deliver competitive advantage. As payment becomes borderless, MSMEs can access overseas markets through the digital payments platform used globally. MSMEs can also create value-added services, such as customer loyalty programs/rewards since they can analyze their customers’ profiles and behavior like their spending profile and behavior.

Conclusion
However, although digital payments benefit MSMEs, still, in the case of Uganda, there is still limited research in investigating the impact of digital payments on MSMEs’ businesses

1. Custom software development requires quality developers, effort, and time, making planning for your business needs highly important.

2. As noted earlier, 71% of consumers expect companies to deliver personalized solutions, and 76% get frustrated when this doesn’t happen.

3. According to Stackify, around 17.7% of companies expressed that continuous performance and load testing management is one of the major challenges faced by the development team.

4. The average custom software development project takes between 4 and 12 months to complete, depending on the complexity.

Conclusion
You know your customer’s needs better than others, and the customer is everything to your business. Identify target customer trends, and develop application software that addresses those trends whenever possible. More personalized customer experiences generate higher customer satisfaction for your business. Whenever your budget and business can afford it, take advantage of custom software development to better engage with your customers and generate greater loyalty.

1. Fintech is Safe and Secure
Some believe that FinTech services are not particularly reliable when it comes to security. However, this is simply not true. It’s actually traditional banks and financial institutions that can be more susceptible to security issues due to their slow nature in adopting the latest technology and cybersecurity measures.

Benefits of FinTech for Businesses, Consumers, Investors and Founders

2. Fintech Creates Financial Inclusion 
Fintech can be used anywhere, by anyone. Meaning it becomes accessible to people who may never have taken advantage of financial services before. Continents like Africa are particularly benefiting from fintech, as providers like Yo! Uganda revolutionise how people manage their money. Through access to basic financial services such as mobile money and e-wallets, fintech companies are helping lift people out of poverty and create a more financially inclusive world.

3. Fintech is a More Cost-Effective Option
Fintech companies can often deliver the same solution for a lower price compared to traditional financial institutions. By leveraging technology to automate tasks, FinTech companies can save money on employing people to do the work. They also save money by not having physical branches to service their customers. Overall, FinTech companies usually have relatively low overhead costs, which allows them to pass the savings on to you. Today you can find bank accounts with no fees and stock trading apps with no commission. That means more money in your pocket.

What Is FinTech And How Does It work?

4. Fintech Empowers Small Businesses
Large businesses used to have the upper hand when it came to using the latest technological and financial tools. Fast forward to today, and this is no longer the case. Now even a solopreneur can use some of the tools that the big boys use, whether it’s processing payments through Square and Stripe or efficiently managing your accounting through Xero or QuickBooks. Innovative FinTech products enable small businesses to expand their services further and operate at higher efficiency and scale.

5. Fintech Enhances Financial Capability
Whether it’s our personal finances or investments, fintech helps to simplify how we manage our money. Revolutionary startups are not only building the future of financial tools, but also promoting financial education and literacy. An improvement in people’s financial literacy will help more individuals reduce their debt, understand the value of budgeting and saving and the importance of investing for the future.

Fintech is largely associated with:

• Mobile functionality
• Big data
• Accessibility
• Simplicity
• Cloud computing
• Convenience
• Personalization
• Agility

While traditional banks are currently embracing some of these features, there remain considerable distinctions between them and fintech startups. Here are some of them;

While FinTechs continue to gain ground in the financial services sector, they have some shortcomings. For instance, check out the following;

1. The organizational structure of FinTechs have few barriers to change. As a result, they are responsive to innovation. Their structures can easily be torn down and rebuilt as contrasted with traditional banks.
2. The key feature that distinguishes FinTechs from legacy banks is that they focus on overarching customer experience management, unlike their counterparts that focus on risk management.
3. Key to the FinTechs is the readiness to embrace technology and innovation in the provision of financial services. It is important to point out that the financial sector is highly regulated, making it undesirable for legacy banks to fully embrace technology and innovation for fear of regulatory constraints. It is in this light that Stewart Bromley, of Atom Bank of the UK has stated that while FinTechs are usually associated with energy, freedom, pace, adaptability and customer centricity, legacy banks are keen on governance and risk management which effectively inhibits their innovativeness.
4. FinTechs offer convenient products to customers. You can transfer funds, make purchases or even take an insurance cover anywhere and anytime. With traditional banks, you need to go to the banking hall or an ATM lobby. With FinTechs, you can also obtain credit without having to go through a long and tedious process. No paper work, no collateral, simply a click of a button on your phone or PC.
5. Crowdfunding is a very unique aspect of financial technology. People need not meet physically to contribute to a cause. People in different parts of the world can make their contributions on the cloud.

While FinTechs continue to gain ground in the financial services sector, they have some shortcomings. For instance;

• Inadequate risk management expertise
• Lack of experienced leadership
• Inability to raise substantial capital
• Inability to gain consumer trust.

Clearly, both FinTechs and banks have strengths and weaknesses in the financial industry. It is for this reason that the World Fintech Report 2017 noted that the two will eventually coexist and complement each other.

The financial industry is experimenting with automation, predictive analytics, new delivery platforms, digital-only banking, blockchain and more. These changes are helping the institutions provide higher quality services at lower price points.

As a result, companies in the financial sector are able to better align their business strategies to consumer expectations. The emphasis is on creating better digital processes that consumers can personalize. And these digital FinTech enhancements are creating more positive consumer experiences.

Let’s look into some cutting-edge technologies that are directly impacting the relationship between consumers and financial institutions.

1. Artificial intelligence for predictive analytics
Besides powering chatbots and virtual assistants, artificial intelligence (AI) is also powering large-scale predictive analytics to help consumers find more personalized experiences. Now banks have the power to take all the data about a particular consumer and create a particular financial solution in real-time.

This level of personalization was unthinkable in the past. It might break up the traditional model of checking, savings, and loan management processes.

Banks can use the AI-driven predictive analytics to design individual financial packages for individual customers. AI in FinTech helps improve customer retention, speed-up loan approvals and prevent financial frauds.

2. Chatbots and virtual assistants for consumer education
Mobile devices, better network connectivity and improvement in artificial intelligence have made chatbots and virtual assistants easy to implement.

Most people are not financially savvy. When they contact any kind of financial institution, they are looking for guidance.

In the past, human advisors helped consumers understand their options. However, most of the customers have a similar line of questions with slight variations.
Banks and other financial institutes tried to answer these questions through frequently asked question (FAQ) pages. But these pages can become hard to navigate due to their length and become ineffective.
So businesses in the financial sector are using chatbots and virtual assistants to more effectively deliver content.

3. Digital-only banking
In the past, consumer confidence in financial institutions depended on physical infrastructure.
However, that sentiment seems to be changing. Most banks already maintain some form of digital presence through websites and mobile apps. However, a new generation of banks is going all digital to reach mobile-first consumers.

Digital-only banks (the most profound example of FinTech technologies on the market today) cut down infrastructure and human resources costs. So they can deliver cheaper services of the same quality as traditional banks.

As more digital banks start offering better deals to consumers, traditional financial institutions will have to compete. Overall, it will provide better options for consumers.

4. Internet of things (IoT)
Even though most FinTech companies are not utilizing IoT at the moment, there are lots of opportunities to explore. IoT is basically various connected devices.

As more and more devices get connected to the internet, it opens up new opportunities for financial institutes.

For example, companies can deploy IoT devices to collect insurance telematics and use the information to provide customized insurance coverage. In case of an accident, IoT devices can provide more accurate information to make faster claim decisions.

So, the deployment of IoT-based insurance services means consumers can take advantage of cheaper rates and get faster services.

5. Augmented Reality
Augmented reality (AR) is helping FinTech institutions enhance and enrich services for consumers.
Compared to virtual reality (VR), AR has proven more practical. VR requires expensive headsets. But most consumers can access AR technology through their mobile phones. Financial institutions are trying to create interactive AR experiences in physical spaces.

Wells Fargo has created an AR-based system [] that allows consumers to interact with bank tellers in an augmented reality environment. The experience combines the digital and physical world for consumers. They feel more connected to the institution because the experience has a physical component to it.

Summary
Consumers are benefitting from the various technologies that the financial industry is implementing. In a competitive market place, consumer confidence is always important. So, financial institutions who can embrace innovative solutions will enjoy sustained consumer loyalty.

Value added services don’t stop at accessing financial options online though. The convenience of a centralized digital wallet, for example, is an idea that more and more consumers are becoming used to. In Uganda, we have seen many successful examples of traditional banks offering wider-ranging digital services. The switch to smart device-based banking apps has seen increased convenience for consumers, often coming with the ability to pay utilities, transport, credit card bills, and more from one central account without having to change physical location.

Mobile financial services are in particular demand. The appeal of having a single device where you can access your bank account, pay your bills, access government services, and of course access entertainment services, is obvious. Further integration of services into this environment is high on the list of customer priorities. Further collaboration between banks and FinTechs will see higher levels of security and trust in these products which will only increase uptake further.