MTN Uganda Plans Mobile Money Spin-Off

MTN Uganda has shared plans to restructure its mobile money operations through a proposed reorganization of its subsidiary, MTN Mobile Money (U) Limited (MTN MoMo). This initiative seeks to detach MTN MoMo from the parent company, enabling its mobile money and fintech operations to function independently under a newly established entity.

Currently MTN MoMo runs the fintech and mobile money industries. MTN MoMo is wholly owned by MTN Uganda and it provides financial products, fintech services, and payments to millions of Ugandans.

MTN Uganda announced on 11 June 2025 that it will hold a special shareholders’ meeting on 2 July to vote on spinning off its mobile money business (MTN MoMo) into a separate fintech company. If approved by shareholders (at least 75 percent of votes cast) and regulators, MTN MoMo will cease to be a subsidiary of MTN Uganda. Under the plan, MTN MoMo’s operations will be merged into a new entity called “MTN New FinCo,” 76 percent owned by MTN Group Fintech Holdings and 24 percent held via a trust on behalf of MTN’s minority shareholders. MTN says the spin-off is needed in part to comply with Uganda’s 2020 National Payment Systems Act (which requires mobile money providers to operate as distinct legal entities) and to align with MTN Group’s strategic goal of building “valuable platforms” under its Ambition 2025 plan.

The idea of separating MTN’s mobile money services has been in discussion for years. Uganda’s National Payment Systems Act of 2020 required mobile money services to be run by separate companies, not directly by telecom operators. In 2021, MTN Uganda set up MTN Mobile Money (U) Limited (MTN MoMo) as a subsidiary to comply with this law, giving it legal independence while still being fully owned by MTN Uganda. Now, MTN is taking things further by turning MTN MoMo into a standalone fintech company, with part of its ownership going to non-telecom investors.

MTN Group’s wider strategy also drives the plan. In recent years MTN has announced similar fintech separations in other markets, including Nigeria and Ghana. Company documents note that spinning off the payments business will “build valuable platforms” and encourage dedicated fintech investors and partners. For example, just last month MTN Ghana completed a similar move, it created a new entity called  New FinCo company for its MoMo business (to meet local ownership rules), putting 32 percent in a trust for Ghanaian minority shareholders. In MTN Uganda’s case, the trust will hold 24 percent for local minority shareholders, matching their existing stake in MTN Uganda.

The company says the spin-off will unlock value and fuel growth. MTN Uganda CEO Sylvia Mulinge has explained that separating the fintech arm “is anticipated to bring in fresh capital, expertise, and innovation that might not have come otherwise”. In her words, “We are doing this to unlock a lot more value for our fintech business”. The expectation is that a standalone fintech company can pursue partnerships and financing more nimbly, while MTN Uganda focuses on core telecom services. Indeed, MTN notes that its fintech unit in Uganda is already substantial, it has an estimated 14 million active mobile-money subscribers and saw payment revenue growth of about 18 percent in early 2025, underscoring why the business is considered a “high-growth” asset.

The spin-off is structured as a two-step process requiring both shareholder and regulatory approvals:

Shareholder Vote: MTN Uganda’s board has called an Extraordinary General Meeting (EGM) on 2 July 2025 to seek consent. The cautionary announcement to shareholders makes clear the deal “will be presented to the MTN shareholders for consideration” at that meeting. Under Uganda’s exchange rules, at least 75 percent of votes cast must approve the motion. MTN has over 20,000 shareholders (including pension funds and retail investors); the National Social Security Fund alone holds about 11.7 percent. MTN emphasizes that voting in favor is voluntary and that shareholders can access a detailed circular explaining the transaction.

Regulatory Approvals: The spin-off also needs clearance from multiple Ugandan authorities. According to MTN’s shareholder circular, the Bank of Uganda (Uganda’s central bank) is a key approver, since it regulates payment systems. Other involved regulators include the Capital Markets Authority (CMA) and the Uganda Securities Exchange (USE) for compliance with corporate and listing rules. Tax authorities (Uganda Revenue Authority) and the Commissioner for Labour must be notified, and the Ministry of ICT & National Guidance and Uganda Communications Commission will be informed. Only after all required consents and “no-objection” letters are obtained will the deal proceed. MTN’s notice cautioned that the transaction is subject to these conditions, and investors were advised to “exercise caution” when trading MTN stock until the outcome is known.

“The Proposed Transaction is subject to a number of conditions, including receipt of MTN shareholders’ approval, and all other required regulatory approvals and no-objections. The detailed list of regulatory approvals and notifications that are required are set out in Part 2: Page 31 of the shareholder circular.” MTN’s notice stated.

If approvals are secured, MTN will execute the reorganisation. MTN MoMo will merge into the New FinCo and the trust will be set up to hold shares on behalf of minority investors. MTN says service delivery will not be affected, both the cautionary notice and tech press reports stress that current mobile-money services should continue uninterrupted under the new structure. MTN Uganda will remain listed on the USE, but its share of fintech profits will then flow through MTN Group Fintech instead of its telecom accounts.