Bank of Uganda (BoU) has announced new over-the-counter cash withdrawal limits and reduced interbank cheque value thresholds, citing a growing shift by consumers toward digital payment methods.

The changes will take effect on January 1, 2027, and are aimed at supporting the country's transition to electronic financial services while maintaining flexibility for sectors that still depend heavily on cash transactions.

In a statement issued on June 3, 2026, the central bank said it had observed a steady decline in the use of paper-based payment instruments and increasing consumer preference for digital financial services.

Under the new measures, over-the-counter cash withdrawals from individual accounts will be capped at UGX 50 million per day and UGX 500 million per week. Corporate and business accounts will be subject to a daily withdrawal cap of UGX 250 million and a weekly cap of UGX 2.5 billion.

The limits will apply to accounts held with financial institutions supervised by Bank of Uganda.

However, the central bank clarified that the restrictions will not apply to digital payment channels such as the Real Time Gross Settlement System (RTGS) and Electronic Funds Transfers (EFTs).

BoU said consumers are increasingly embracing electronic payment methods, with electronic credit transfers now ranking as the leading payment method. The central bank also noted that digital payments continue to grow in both volume and value.

At the same time, Bank of Uganda announced a downward revision of interbank cheque value limits for currencies handled through the Automated Clearing House.

For Uganda Shilling-denominated cheques, the limit will be reduced from UGX 10 million to UGX 5 million. The United States Dollar limit will decrease from USD 2,750 to USD 1,375, while the Euro limit will fall from EUR 2,250 to EUR 1,125.

The British Pound Sterling threshold will be lowered from GBP 2,200 to GBP 1,100, while the Kenya Shilling limit will be reduced from KES 300,000 to KES 150,000.

According to Bank of Uganda, interbank cheques exceeding the new thresholds will not be honoured beginning January 1, 2027.

The central bank emphasized that these limits do not apply to intra-bank cheque payments, where both the drawer and the payee maintain accounts within the same financial institution.

BoU further revealed that cheque usage has declined significantly over the past six years, falling from 14 percent of the transactions cleared annually to 6 percent, reflecting a continued migration toward digital payment channels.

Recognizing that some sectors remain heavily dependent on cash, the central bank has provided for an exception management framework. Under the framework, supervised financial institutions will be required to implement risk-based customer profiling, and may request waivers from Bank of Uganda for specific transactions or sectors where necessary.

Financial institutions have also been directed to encourage customers to use alternative payment methods including RTGS, EFTs and mobile money bank-to-wallet transfers.

Bank of Uganda said it remains committed to supporting the development of an innovative, vibrant, inclusive and resilient payments ecosystem that contributes to Uganda's socio-economic transformation.