The West African sub-region has been classified as the world leader in Mobile Money Services according to the latest report by GSMA. The report highlights that countries within the region, such as Nigeria, Ghana and Senegal, have registered a 100% increase in accounts from 2013 to 2023. This reinforces the West African sub-region's position as a pioneer in mobile money adoption.
The report notes that the growth was driven by regulatory frameworks that enabled a shift to digital transactions, resulting in a surge in international remittances and merchant payments. For instance, the West African Economic and Monetary Union (WAEMU) experienced a significant rise in the use of mobile money, with over 110 million new mobile money accounts being added between 2018 and 2022. This boosted financial inclusion from 56% to 71% for a population of over 137 million, with 60% of them residing in rural areas.
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 growth rates were slower when compared with 2022, showing that mobile money continues to be
used more frequently, but for smaller transactions.
Accessing mobile money the report acknowledged is hindered by several factors, such as low mobile ownership, perceived relevance, digital skills, social norms, and trust levels. The lack of mobile ownership is the most significant barrier. Although the number of registered mobile money accounts is 1.75 billion, there is still a significant gender gap. Women globally are 7% less likely than men to own a phone, and this gap exists in all survey countries, except for Kenya.
Beyond addressing individual challenges, an
enabling regulatory landscape is crucial for boosting global financial
inclusion and mobile money uptake, adding that 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. However, 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
