MTN Uganda is taking a major step toward spinning off its mobile money fintech arm

MTN Uganda’s MoMo platform has become a powerhouse: fintech revenue grew 23%, boasting 13.2 million mobile-money users—over half the population—and processing nearly 3 billion transactions worth ~UGX 114 trillion in the first nine months of 2024 .This massive growth shows MoMo has evolved from a feature into a core digital finance business.

Regulatory Support & Autonomy
A separate fintech entity would benefit from targeted oversight and agility under Uganda’s evolving regulatory frameworks—which now grant the Bank of Uganda authority over Payment Service Providers. Full operational and governance independence could streamline compliance, licensing, and innovation .

Institutional Investment Opportunities
MTN Group has recently secured one of Uganda’s largest local-currency syndicated loans (UGX 370 billion) to fuel fintech expansion . Market whispers also suggest MTN is preparing for equity partnerships—including high-profile investors like Mastercard—to back MoMo. A standalone fintech allows equity dilution or IPO without affecting the telecom core.

Enhanced Focus & Partnerships
As MoMo evolves to offer loans (MoKash, MoMo Advance), savings, e-commerce, and small-business APIs, independence enables dedicated leadership, partnerships, and product focus. This sets the stage for innovation around embedded finance, virtual cards, and USD corridor expansion.

Strengthening Competitive Position
Separating MoMo helps MTN better position it for expansion, both regionally and across verticals. With regulators like BOU licensing more fintech players, a clean corporate structure reinforces MoMo’s credibility among digital banks, remittance providers, and global payment firms.

 Strategic Benefits of the Spin‑Off

• Strategic clarity: MoMo becomes a focused fintech, freeing MTN telecom to concentrate on connectivity.
• Financial transparency: Separate reporting highlights MoMo’s value and attract specialized investors.
• M&A flexibility: MoMo could pursue deals, partnerships, or regional rollouts without telecom baggage.
• Regulatory agility: Opportunity to obtain specialised licenses tailored to fintech products like virtual currencies or e-commerce.

 Timeline & Outlook

MTN Uganda is expected to finalize the spin-off in late 2025, post-licensing updates and securing institutional capital . Once realized, MoMo stands primed to accelerate financial services innovation, deepen revenue diversification, and anchor Uganda’s digital economy growth.

 Bottom Line

Spinning off MTN MoMo is a calculated move to unlock its full strategic and financial upside. With fintech revenues surging, institutional backing growing, and regulatory frameworks maturing in its favor, MoMo is ready to step out as a standalone fintech force—set to define the next wave of digital inclusion in Uganda.

SOURCE: WEST AREKAMHE