E-waste, which includes discarded mobile phones and outdated hardware, has emerged as a significant challenge for the environment. Fintech companies, striving to provide advanced financial services to those without access to traditional banking, are working to align their operations with environmental, social, and governance (ESG) objectives.
This situation coincides with Africa being identified as the continent most vulnerable to climate change, as reported by the African Development Bank.
The Financial Technologies Services Provider’s Association (FITSPA Uganda) highlights in the Fintech Fund Feasibility Study that the growth of Fintech services contributes to electronic waste, including obsolete mobile phones and hardware, posing environmental risks.
FITSPA also underscores the energy-intensive nature of Fintech operations, such as mobile phones, data centers, and internet station infrastructure. These activities consume substantial energy resources and strain energy infrastructure, contributing to increased carbon emissions and worsening climate change concerns.
The study further emphasizes the need for credit guarantee programs to encourage Fintechs to adopt e-waste disposal and recycling policies. These policies are essential to mitigate environmental harm and promote a circular economy.
Bank of Uganda data reveals the presence of at least 24 financial technology companies operating in Uganda.
Fintechs have made notable progress in reaching large portions of the population, particularly those in remote or marginalized regions with limited access due to infrastructure and technological literacy challenges.
These companies handle and store significant volumes of sensitive customer personal and financial data, raising concerns about potential misuse of this information and data breaches. Such incidents could harm individuals and erode confidence in the Fintech industry.
