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MTN under fire over mobile money reversal

What started like a normal Twitter rant on a quiet Sunday afternoon, just over a week ago, about MTN Uganda’s failure to make a swift reversal of a mobile money transaction sent to a wrong party has evolved into a full-blown social media firestorm for the telecom firm, with the Twitter campaign entering a new phase that might involve a lawsuit, writes FRANK KISAKYE. 

The leaders of the campaign say they are entering a new phase after an elapsed deadline for MTN Uganda to commit to an open, transparent and constructive dialogue on how to put in place measures on mobile money reversals.

The cannonade of complaints and accusations was sparked off by Makerere University law don, Dr Busingye Kabumba on Twitter on Sunday, May 27, 2018.

“Wonders never cease. I sent mobile money to a wrong @mtnug number yesterday. Called MTN immediately and a ‘reversal’ was ‘initiated’. Was assured that the funds would be credited on my account ‘within 24 hours,’ he wrote in a Twitter thread.

He added: “I followed up the matter with @mtnug a few hours later. The customer care agent this time stipulated 72 hours as the requisite waiting period. When I pointed out the discrepancy between 24 and 72 hours, no clear response was forthcoming...Just called @mtnug again, and now being told that I should call the person who received the money in error and ‘reach a mutual agreement’ with them [angry emojis]. The apparent alternative is to secure a ‘court order’!!! If this is not bufere [fraud], I don’t know what is!”

Buoyed by similar complaints of failed reversals from numerous subscribers, who accused the corporate giant of ‘corporate theft’ and ‘corporate arrogance’ among others, Busingye went on to create a hashtag #MTNUgandaMweddeko [MTN reform].

Initially, MTN treated it as another of those customer complaints, but the now week-long tirade soon sucked in their topmost employee, the chief executive officer, Wim Vanhelleputte.

He responded two days later after Busingye’s post, saying he had personally looked into the matter and the reversal had been effected after approval from the wrong recipient.

Requiring approval from the wrong recipient became the centre of the discussion with several subscribers citing fellow telecom, Airtel, that does reversals without the need for the approval of the wrong recipient.


“Unfortunately, the reversal cannot be done without authentication from the wrong receiver. We respect all customers and their privacy; thus we always seek authentication to make reversals in case they receive money accidentally…” MTN wrote on the Twitter handle, @mtnug.


As the matter became heated, the regulator, the Uganda Communications Commission, weighed in.

“Regulations under the Uganda Communications Act do not cover mobile money transactions. This would ordinarily be under the Financial Institutions Act and as we know regulations specific to MM [mobile money] don’t exist. This has largely been driven by innovation and regulation is doing catch-up,” said Uganda Commercial Communications (UCC) commercial manager Ibrahim Bbossa.

Bbossa said the aspect of reversing mobile money transactions in the case of an erroneous transfer had been largely left to the operators. He added that regulating everything would stifle innovation.

Vanhelleputte went on to say the reason MTN doesn’t do reversals is because of the existing Bank of Uganda regulations. He referred to the Bank of Uganda letter written by Jane Bagenda and sent to then MTN Uganda managing director on April 5, 2013.

The letter from the office of executive director, Supervision, pointed out that: “Bank of Uganda has received a lot of complaints from the public regarding the operations of some of the mobile money service providers. In particular, mobile money users have lost their funds after erroneously pressing a wrong digit on their mobile phones when transmitting money to their recipients. Instead of the intended recipient, those funds have found their way to wrong account due to errors made. In such cases, the mobile money service providers have not made any effort to assist the sender recover his or her money. Instead, the sender has been advised to report to the police,” Bagenda’s letter reads in part.

In the same letter, Bank of Uganda expressed concern that mobile money service providers had not put in place mechanisms to address the matter of erroneous mobile money transfers and reversals. BOU went further to direct MTN Uganda to record such occurrences in the complaints log and proceed to instruct the recipient of the funds to return it to the sender.

In case the receiver refuses to refund the money within 48 hours, BOU said in the letter, the mobile money account of the recipient should be immediately blocked. It also implores the telecom to make all attempts to locate the wrong recipient and also report the matter to police.

“We shall appreciate if any other mitigants are put in place by mobile service providers to avert the vice. Failure to address the vice will compel Bank of Uganda to take administrative sanctions on the mobile money service provider,” she concluded.


Local media has not been spared either by subscribers, with many accusing the media houses of lacking the guts to report about the matter, insinuating that the telecom firm was a key advertiser for a number of media houses.

“This is by far my greatest revelation...‘Corporate state capture’ That the majority of Uganda’s major media outlets are not independent. We can’t blame politicians anymore, our media is not gagged. They are simply in survival mode,” wrote @JenifaOchwo.

Bank of Uganda estimates there were at least Shs 54 trillion worth of mobile money transactions in 2017 compared to Shs 44 trillion in 2016. Of the 22 million mobile money subscribers, more than half use the MTN Uganda platform.



+2 #1 Eric L 2018-06-07 13:36
Quite an interesting battle of the brains,this is the kind of debates I like.

Truly MTN has a case .Reversals of bankings do not just happen. There should be a level of consent.

On the other hand true MTN is quite arrogant that now is the time for BOU to have some guidelines/sops for MM operators.

Otherwise many people will lose monies under such laziness and arrogance of telling customers to make their own arrangements to have reversals made by parties not known to them.

Its such madness that once saw me leave this network as I was advised to take my complaints against un solicited messages to the senders and not MTN!!!
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+2 #2 Adrian 2018-06-08 09:00
The same experience with YAKA Payments. UMEME tosses us up and down and does not give a solution.

People in the corridors ask you to look for the account holder, negotiate with him/her so that you have a refund!!!!!
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0 #3 Bernard 2018-06-14 15:03
Just like Adrian as put 2 weeks ago i paid YAKA UGX 30,000 but up to now i haven't got any calls from them nor any units i paid for.

The concerned Institution should help regulate or provide clear guideline for such transactions, people are bleeding internally>>>
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