Uganda’s central bank has ordered banks to halve interbank cheque limits and impose new over-the-counter cash withdrawal caps from Jan. 1, 2027 in its strongestUganda’s central bank has ordered banks to halve interbank cheque limits and impose new over-the-counter cash withdrawal caps from Jan. 1, 2027 in its strongest
REGULATION | Uganda Central Bank Slashes Cheque Limits, Caps Cash Withdrawals to Improve Transparency and Traceability
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Uganda’s central bank has ordered banks to halve interbank cheque limits and impose new over-the-counter cash withdrawal caps from Jan. 1, 2027 in its strongest move yet to steer transactions onto digital payment channels and reduce reliance on cash and paper instruments.
This is what has changed:
| Category | Previous limit | New limit |
|---|---|---|
| Interbank cheque limit (UGX) | 10 million | 5 million |
| USD cheque limit | 2,750 | 1,375 |
| EUR cheque limit | 2,250 | 1,125 |
| GBP cheque limit | 2,200 | 1,100 |
| KES cheque limit | 300,000 | 150,000 |
| Individual OTC cash withdrawal | — | UGX 50 million/day; UGX 250 million/week |
| Corporate OTC cash withdrawal | — | UGX 500 million/day; UGX 2.5 billion/week |
The limits apply to
- over-the-counter cash withdrawals
- interbank cheque clearing
- digital channels such as RTGS, EFT,
Mobile/internet banking are not capped by this measure.
The Bank of Uganda said the measures align with its e-payments strategy and broader national digitalisation agenda adding that banks must direct customers to alternatives including RTGS, EFT, mobile, and internet banking.
Why the central bank is doing this
Beyond the headline limits, several third-party sources point to a broader policy rationale:
| Driver | What sources say |
|---|---|
| Accelerate the shift to electronic payments | BoU explicitly framed the move as part of a “cash-lite economy” strategy and told banks to direct customers toward RTGS, EFT, mobile and internet banking. |
| Continue a multi-year reduction in cheque use | Uganda previously cut interbank cheque limits in 2021/22 from UGX 20 million to UGX 10 million, and the new step halves them again to UGX 5 million. The earlier policy was likewise justified as promoting e-payments. |
| Leverage the rapid growth of digital payments and mobile money | Bank of Uganda data cited by local media show cheque transaction values fell sharply while EFTs and electronic-money transactions expanded. Mobile-money usage has become a dominant payment rail for low-value transactions. |
| Improve transparency and traceability | BoU said the policy is intended to enhance efficiency, transparency and traceability within the financial system by reducing large cash transactions. |
| Address concerns around large cash withdrawals | Local reporting says the announcement comes amid public debate over large cash withdrawals linked to recent corruption allegations and scrutiny of high-value cash handling by officials. BoU did not publicly cite anti-corruption as the formal reason, but the timing has been widely discussed. |
| Allow exceptions for cash-heavy sectors | The circular leaves room for risk-based treatment of sectors such as agriculture and artisanal mining that still depend heavily on cash. Banks are expected to maintain customer risk profiles and set appropriate withdrawal arrangements. |
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