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Uganda’s Banking Regulator Clarifies KYC Requirements for Individuals and Entities

Kampala, Uganda - The Bank of Uganda (BoU) has confirmed that in the event of inconsistency between two regulations, financial service providers should follow the Anti-Money Laundering Regulations, 2015. The regulator plans to review both documents and resolve any inconsistencies in the future.

Importance of Complying with KYC Regulations

The BoU’s clarification comes as a relief to financial institutions operating in Uganda, which have been grappling with the nuances of Know Your Customer (KYC) requirements for different individuals and entities. In a recent interview, Deputy Director at the Commercial Banking Department, [Name], emphasized the importance of complying with KYC regulations to prevent money laundering and terrorist financing.

Comprehensive Guide to KYC Requirements

To clarify the requirements, we have compiled a comprehensive guide outlining the necessary documentation, verification procedures, and additional information required from various types of individuals and entities.

Individuals

  • Sole Proprietorships: Require similar documentation as individuals, including:
    • National ID or alien ID card
    • Address
    • Phone number
    • Email
    • Intro letter from employer, school, or senior government official
    • Tax ID number (if applicable)
    • Nature of business activities
    • Signature/Thumb print
  • Partnerships: Need to provide additional information including:
    • Name of partnership
    • Registered name and registration number
    • Copy of partnership deed
    • Details of registered address or principal place of business
    • Information on each partner and any other person who exercises control
    • Prior year’s financial statements

Individual Banking Agents

The draft Financial Institutions (Agent Banking) Regulations, 2017 require banks to confirm that the sole proprietor or partnership has an account in a licensed financial institution, has a registered and licensed business, has a physical address, has adequate and secure premises, and has been engaged in commercial activity for at least 12 months.

Individual Mobile Money Accounts

The Anti-Money Laundering Regulations, 2015 do not explicitly refer to simplified due diligence, but the BoU’s decision not to amend the guidelines following the issuance of the regulations suggests that the regulator is comfortable with the application of simplified due diligence for individual mobile money accounts subject to transaction limits.

Verification of Individuals

If banks require further information to verify an individual’s identity and/or immigration status, they may seek further proof of identity from the prospective client or confirm their identity or immigration status with relevant government authorities.

Conclusion

The clarification on KYC requirements by the BoU is a significant step towards ensuring compliance with anti-money laundering regulations in Uganda. Financial institutions are advised to carefully review the guidelines and implement necessary measures to prevent financial crimes.

Sources

  • Bank of Uganda, “Anti-Money Laundering Regulations, 2015”
  • Bank of Uganda, “Mobile Money Guidelines, 2013”
  • Draft Financial Institutions (Agent Banking) Regulations, 2017

Disclaimer

The information provided in this article is for general purposes only and should not be considered as legal or professional advice. It is recommended that financial institutions consult with relevant authorities and experts to ensure compliance with regulatory requirements.