KAMPALA — Ugandans will face strict new limits on the amount of cash they can withdraw over banking counters beginning January 1, 2027, after the Bank of Uganda (BoU) announced sweeping measures aimed at accelerating the country’s transition to digital payments.
Under the new rules, individuals will not be allowed to withdraw more than Shs50 million per day over the counter, while companies and other business entities will be restricted to a maximum of Shs250 million per day.
The central bank announced the changes, saying the move is part of the financial sector’s broader e-payments strategy and is intended to align Uganda with global trends that increasingly favour electronic transactions over physical cash.
“We are introducing limits to how much cash can be withdrawn over the counter from the financial institutions we supervise starting 1 January 2027,” BoU said in a statement.
The regulator explained that the decision follows a significant shift in how Ugandans make payments, with electronic channels now overtaking traditional cash transactions.
“According to our data, payments have undergone a digital shift and electronic credit transfers are the number one payment method,” the central bank said.
BoU added that digital transactions continue to register strong growth both in volume and value, reflecting growing public confidence in cashless payment systems.
“Digital payments continue to grow in volume and value, indicating that consumers trust and prefer their efficiency,” the statement reads.
According to the new framework, all accounts held in supervised financial institutions will be subject to the withdrawal caps. Individual account holders will face a daily withdrawal limit of Shs50 million.
Corporate and business account holders, meanwhile, will be permitted to withdraw up to Shs250 million per day.
The central bank emphasized that the restrictions apply specifically to over-the-counter cash withdrawals and will not affect digital payment channels.
“The above limits do not apply to digital payment channels such as the Real Time Gross Settlement System and Electronic Funds Transfers,” BoU said.
The regulator argued that electronic payment systems offer safer, faster and more efficient alternatives to handling large amounts of cash and are increasingly becoming the preferred option for businesses and consumers alike.
However, BoU acknowledged that some sectors of Uganda’s economy still rely heavily on cash transactions and said provisions have been made to accommodate genuine cases that may require larger withdrawals.
“Because some sectors still depend heavily on cash, financial institutions will be able to seek exceptions for certain transactions or sectors,” the central bank said.
Under the exception framework, supervised financial institutions will first be required to establish comprehensive customer risk profiles that can guide decisions on withdrawal limits.
“SFIs are required to develop and implement comprehensive risk-based customer profiles based on which lower limits could be set,” the statement says.
The Bank of Uganda also retained the authority to waive withdrawal caps in special circumstances.
“The Bank of Uganda may discretionally waive the limits for certain transactions or sectors on the request of the supervised financial institutions,” BoU stated.
In addition, banks and other regulated financial institutions will be expected to encourage customers to use alternative digital platforms whenever possible.
“SFIs shall advise their customers on the available alternative digital channels such as Real Time Gross Settlement, Electronic Funds Transfers, and Mobile Money Bank to Wallet transfers,” the central bank said.
The announcement marks one of the most significant policy shifts in Uganda’s banking sector in recent years and signals the central bank’s determination to reduce dependence on cash transactions while strengthening the country’s digital payments ecosystem.
BoU said it remains committed to supporting “the development of an innovative, vibrant, inclusive and resilient payments ecosystem that supports socio-economic transformation.”
The new withdrawal limits will officially take effect on January 1, 2027.
The new rules come months after several NGOs’ bank accounts were frozen. (See Details Here and There).
