Mobile money services, particularly in West
Africa, have seen exponential growth, with registered accounts doubling over
the past decade, according to the 2024 'State of the Industry Report on Mobile
Money' prepared by the GSMA. In 2023, global money transactions increased by
14% year-on-year (YoY), equating to $2.7 million per minute.
The GSMA Mobile Money Programme, supported by
the Bill and Melinda Gates Foundation, works to enhance the development of
mobile money ecosystems for the underserved. The 2024 edition finds a 23% YoY
increase in transaction volumes, reaching 85 billion annually. Between 2013 and
2022, countries with mobile money services saw a $600 billion higher GDP than
those without, equivalent to mobile money increasing GDP by around 1.5%.
However, while both transaction value and volume increased, the rates of growth
were slower when compared with 2022, showing that mobile money continues to be
used more frequently, but for smaller transactions.
Mobile money is boosting socioeconomic impact
Mobile money boosts financial inclusion and
digital access, serving as a catalyst for achieving 15 out of 17 United
Nations' Sustainable Development Goals (SDGs), up from 13 in 2019. As the
mobile money market starts to mature, the use cases are becoming more
sophisticated. More providers now offer adjacent financial products, such as
credit, savings, and insurance. Credit is the most popular adjacent financial
service offered by mobile money providers (MMPs), with a 73% increase in the
number of credit products offered YoY
This diversification of use cases is empowering
the underserved, including women and rural populations, to save money through
mobile money accounts. MMPs tracking disaggregated data found a 98% increase in
the cumulative number of unique female customers saving via mobile money,
between September 2022 and June 2023. In addition, increased business adoption
of mobile money saw average revenue per user grow from $2.2 in September 2022
to $3.2 in June 2023 – an increase of over 40%.
Mobile money accounts are on the rise
In 2023, global registered mobile money
accounts reached 1.75 billion, a 12% increase from 2022. Although the YoY
growth rate of registered mobile money accounts is slowing (from 15% in 2022
and 19% in 2021), this reflects the start of the industry's maturation. Growth
has been pronounced in Sub-Saharan Africa where the share of registered
accounts has increased for two consecutive years to 47% in 2023, the highest
since 2019. Sub-Saharan Africa accounted for over 70% of the total growth in
registered accounts in 2023, with South Asia contributing a fifth.
West Africa becomes mobile money's powerhouse
West Africa, particularly Nigeria, Ghana, and
Senegal have seen a 100% increase in registered accounts from 2013 to 2023,
establishing itself as a leader in mobile money adoption. This growth, driven
by enabling regulatory frameworks, has facilitated a shift to digital
transactions, underpinned by a surge in international remittances and merchant
payments. For instance, the West African Economic and Monetary Union1 (WAEMU)
experienced significant growth in the use of mobile money adding over 110
million new mobile money accounts between 2018 and 2022. In turn boosting
financial inclusion from 56% to 71% for a population of over 137 million, with
60% residing in rural areas2.
Significant barriers remain
Barriers to accessing mobile money include low
mobile ownership, perceived relevance, digital skills, social norms, and trust
levels. Lack of mobile ownership remains the biggest barrier; though the total
number of registered mobile money accounts stands at 1.75 billion, a sizeable
gender gap remains. Globally, women are 7% less likely than men to own a phone,
this gap in mobile ownership exists in all survey countries, except
Kenya.
Beyond addressing individual challenges, an
enabling regulatory landscape is crucial for boosting global financial
inclusion and mobile money uptake. Taxation remains an important regulatory
challenge for many mobile money services. Mobile money taxation can be a
convenient revenue-earning opportunity for many governments in Sub-Saharan
Africa. Though, countries including Ghana and Tanzania have experienced the
negative effects of taxing mobile money transactions.
Ashley Olson Onyango, Head of Financial Inclusion
& AgriTech at GSMA, comments "Mobile money has demonstrated its
potential to transform economies and societies, driving financial inclusion and
sustainable development worldwide. As the industry has started to mature, it is
also clear that mobile money offers a sound commercial proposition. Between
2022 and 2023 the average revenue per user rose 40% validating the recent
investment that the industry has seen. To ensure mobile money remains safe,
accessible, and affordable, there is a clear need for governments
and regulators to work with financial service providers to
launch financial literacy programmes that can empower underserved populations
and improve their financial decision-making."
By: Nana Appiah Acquaye