Uganda's central bank has drawn a firm regulatory line between the country's cash-heavy past and the digital financial future it is building, and it has given every bank, business, and individual customer until January 2027 to get ready.

The Bank of Uganda (BoU) issued a circular dated May 29, 2026, to chief executive officers of commercial banks, credit institutions, and microfinance deposit-taking institutions, reducing interbank cheque value limits and introducing caps on over-the-counter cash withdrawals as part of its e-payments strategy and broader national digitalisation agenda.

The specific limits are sweeping. Individual account holders will be allowed to withdraw a maximum of UGX 50 million per day and UGX 250 million per week over the counter, while corporate and business accounts face a daily cap of UGX 500 million and a weekly ceiling of UGX 2.5 billion. The cheque regime has been tightened simultaneously. The Uganda shilling cheque limit has been halved from UGX 10 million to UGX 5 million, while dollar-denominated cheques have been cut from $2,750 to $1,375, with equivalent reductions applied to euro, pound sterling, and Kenya shilling denominations.

The BoU was explicit about the intent. "These interventions align with our strategic commitment to fostering a modern, digital-first financial landscape by encouraging a shift from traditional paper-based instruments and cash transactions to secure electronic channels," the central bank said in the circular.

The new limits will take effect on January 1, 2027, giving financial institutions and customers sufficient time to adjust. The BoU said it would collaborate with all stakeholders during the six-month transition period to conduct comprehensive public awareness and information dissemination campaigns.

The policy change arrives on the back of explosive growth in Uganda's digital payments ecosystem. Electronic money transactions grew 28% in 2025 to UGX 366 trillion ($100.3 billion), while transaction volumes increased 17.3% to 9.1 billion. Mobile money transaction values surged 40% to UGX 66.1 trillion ($18.1 billion), and active mobile money customers climbed to 36.3 million, supported by an agent network that expanded 27.5% to more than 1.16 million agents nationwide.

The anti-corruption dimension of the policy has not been lost on domestic observers. The measures have intensified debate over large cash movements, particularly within government institutions, where anti-corruption campaigners have long argued that electronic payments provide a more transparent and traceable alternative to cash.

Financial institutions may seek exemptions in exceptional cases, subject to approval and a comprehensive risk assessment by the central bank. But the direction of travel is unmistakable. Uganda is not nudging its economy toward digital payments; it is legislating the transition, one cash cap at a time.

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