Last weekend I spoke to a money changer friend at the Kenya-Uganda border post.
He’s a good guy, so I do my bit to keep him in business whenever I pass through.
He doesn’t like politics, but has an eye on economic developments. Business, he said, wasn’t brilliant, except for the Ugandans who are selling food — especially the staple grains maize and beans — to Kenya.
Those guys, he said, were laughing all the way to the bank and the slide of the Uganda shilling against Kenya’s was putting even more money in their pockets.
But the biggest headache for the border money changers, he said, was technology. “Credit and debit cards are killing us,” he said. “They used to be just a few, but these days many people have them.
There is no need to exchange Kenya to Uganda shillings or vice versa if you have a credit or debit card and can pay at your hotel, or withdraw money at an ATM when you need it,” he said.
He added that mobile money landed the killer punch.
Forex bureaus in the big cities are not about to all die, but the border money exchangers are a different kind of animal.
In recent years, they existed partly because of what gung-ho East Africanists consider an anomaly — the fact that the East African Community does not have a common currency.
I didn’t probe him on how mobile money has affected his business, because I had an inkling.
The Uganda government and the telecoms regulator, the Uganda Communications Commission (UCC), in the past year have throttled the industry to near death through regulatory overreach.
If you are a foreigner applying for a Ugandan visa, or a Ugandan applying for a national passport, it will probably be easier for you to get it than to replace your lost simcard.
However, because at the border you can get a signal from the mobile providers for some distance into each of the neighbouring countries, Kenyan telcos have profited from the mess.
Kenya’s simcard registration was more competently done, and a generally enlightened regulatory regime has grown up around it.
The results of that are becoming quite odd. A Ugandan at the border, with her Ugandan ID, can replace her Safaricom simcard in minutes, but today may not be able to replace her Ugandan MTN simcard at all.
So there is a drift toward subscriptions with Kenyan service providers.
First to market
If two years ago you had a regular fixer at the border who helped you with car clearance to enable you to cross, he almost certainly had two mobile phone numbers — a Ugandan and a Kenyan one.
Today, don’t be surprised that he has only one — a Kenyan one.
These shifts mean not just the increased use of Kenyan services at the border areas but, especially, given the convenience their digital wallets bring along with it, also opens the possibility eventually the Kenya shilling may become the default currency on the Ugandan side of the border areas.
Many more months of this to come, and I am afraid I may not find my friend next time I pass through.
Why bother to buy Ugandan shillings, when the Kenyan currency will do just as well — if not better.