Describes what a company needs to know to take advantage of e-commerce in the local market and covers prominent B2B websites.
Though loosely regulated and informal, eCommerce continues to rapidly grow in Uganda due to the widespread use of “mobile money” (telephone-based financial transfers) and the rapid growth of mobile phone usage. While there are only 19 million bank accounts in Uganda, there are about 32 million mobile money accounts.
In May 2021, the BOU took over the regulation of Uganda’s mobile money sector after President Museveni approved the National Payment Act, 2020. Through this act, the BOU began regulating fintech and mobile money transactions. The act gives the BOU broad oversight authority, including the power to block eCommerce and mobile money transactions when it deems necessary. In May 2022, BOU ordered cryptocurrency trading platforms operating in Uganda not to transact using mobile money.
B2B/B2C sellers typically market their goods and services online, with consumers and sellers connecting first by phone and then by physical meeting. Payments are typically made in cash or by mobile money transfers. Although shopping directly from a website is a relatively new phenomenon in Uganda, it is fast growing. One key advantage for eCommerce in Uganda is the expanding middle class with a growing taste for U.S. consumer items (regarded as being of superior quality than those from China and other countries). Young people (18 to 30) constitute the bulk of online sellers and buyers.
Advertising in Uganda’s eCommerce market remains largely unsophisticated and is mainly limited to social media platforms. Facebook, WhatsApp, Instagram, Tiktok and Twitter are the most used online platforms in Uganda. After Facebook removed certain accounts affiliated with ruling National Resistance Movement (NRM) party officials for coordinated inauthentic behavior in the leadup to the January 2021 elections, the Ugandan government ordered all Internet service providers operating in Uganda to block access to Facebook; the platform remained blocked as of June 2022 but still receives heavy traffic from Ugandans with access to virtual private networks (VPNs).
Ugandan law provides for the protection of intellectual property rights (IPR) but enforcement mechanisms are weak. The country particularly lacks the capacity to prevent piracy and counterfeit distribution. As a result, theft and infringement of intellectual property rights is common and widespread. Uganda does not track seizures of counterfeit goods or prosecutions of IPR violations.