MOBILE MONEY IN GHANA: A FINANCIAL INCLUSION ENABLER

Management Dynamics in the Knowledge Economy, 2021

This paper details the impact of mobile money financial technology on financial inclusion in Sub-Saharan Africa. The research methodology used was descriptive research design with the use of secondary information sources to collect panel data. The research model had Financial Technology as the independent variable and the dependent variable was Financial Inclusion. The analysis of data was done using Stata 15. From the interpretation of the findings using the panel data on the 14 selected Sub-Saharan countries, it was found that the increase in the number of registered mobile money agents per 100,000 adults led to an increase in the total number of people using the financial services per 100,000 adults in Sub-Sahara Africa. Furthermore, the relationship between the registered mobile money agents per 100,000 adults and the total number of people using financial services was proven to be significant at a 5% level of significance.

Over the years, the evolution of and use of mobile phones and other mobile devices such as tablets has offered society the opportunity to access financial services such as mobile money. Mobile money allows one to transfer money or make payments with their mobile phone, in the comfort of their location and in a simple, fast, convenient and affordable way. This research sought to determine the effect of the evolution of mobile money services on traditional banking in Ghana. The article showed that mobile money is a viable tool for financial inclusion, it has improved efficiency of transactions, it has initiated some changes in traditional banking and has a generally positive impact on traditional banking in Ghana. Keywords: Mobile Phone, Mobile Money Transfer, Financial Inclusion, Mobile Money Subscribers, Ghanaian Economy, Threats, Business Activity, Payment Systems.

The motivation for this study was that, existing literature have reported on the growth of mobile money (MM) and its clientele base. However, studies on the effects of mobile money service on customers and performance of an individual bank; challenges, threats, and opportunities mobile money service presents to an individual bank are very rare to find so adding to the existing studies on the sector will help provide more insight into the operations of the sector and direct policy decisions of policy-makers, bank officials, and telecom operators. This study sought to find out how mobile money services have affected customers and performance of Beige Bank in Ghana. The research is a descriptive survey design that presents results in mean scores, frequency distribution tables, pie charts, bar graph, and Chi-square test of relationship. The study found that mobile money service had a positive effect on customers' remittances. Also, mobile money positively influenced customers' saving habits. Furthermore, majority of the respondents had bank accounts, mobile money accounts, and still engaged in MM transactions. Again, instead of being a threat, mobile money presents opportunities like, cross selling of products, increase in customer base through the registration of mobile money agents, and increased bank commissionIt is recommended that Beige Bank, Ghana and other banks in Ghana should focus on getting mobile agents to save and buy E-cash from them, and develop mobile phone apps which provide access to mobile money service where customers can easily transfer money between their bank accounts and their mobile money wallets.

Journal of International Cooperation and Development , 2023

This study examined the effect of financial technology on financial inclusion in Accra, Ghana. The research was quantitative and employed the correlational and survey research designs. The simple random sampling technique was used to choose a sample of 353 respondents. Questionnaire were employed as the instrument for gathering primary data from individuals in Accra. Statistical Package for Service Solution version 25 was used as the tool for analysing data. The result of the study was analysed using descriptive statistics and linear regression. The finding was that as a result of the introduction of financial application software, respondents were able to access financial products and services of banks. Additionally, the use of internet banking resulted in more of the respondents being financially included. The use of mobile money services also made more of the respondents to be included financially. It is therefore recommended that charges on mobile money services should be reduced to a minimum that allow people to partake in the services in order to encourage financial inclusion.

This paper investigates the role of institutional quality in the relationship between mobile money and financial inclusion in Ghana from 2014 to 2021. It uses annual data from Ghana on a bundle of four financial inclusion variables, six institutional quality indicators (i.e., rule of law, governance efficiency, control of corruption, voice and accountability, regulatory quality and political stability), and total volume of mobile money transaction in a year. The baseline regression was employed. The empirical results reveal that institutional quality and mobile money have direct impact on financial inclusion. Also, institutional quality plays positive and significant role in the relationship between mobile money and financial inclusion. Mobile phone subscription, financial development, inflation and GDPGR influence financial inclusion.

2016

The paper examines the relationship between increasing accessibility to digital financial services (DFS) and financial inclusion in lower income countries (LICs). Banks and non-bank organisations use DFS and the analysis indicates non-bank-based DFS emerges as the most efficient means of delivering cost effective financial services to the previously unbanked. Mobile cellular penetration and internet usage are mutually inclusive means through which digital financial services foster financial inclusion. Analysis of data for Ghana, as a case study, uses ordinary least squares and logistic regression models. The results in Difference-In-Difference method confirms the positive significant trend of mobile money usage and negative trend of bank-based DFS facilities over the period 2011-2014 in Ghana. Unambiguous policy ramifications are emphasised, paying attention to technological deepening stimulate positive outcomes of a broader and inclusive financial system.

Financial Innovation

According to the 2017 Global Financial Inclusion (Global Findex) database, the average penetration rate of mobile money accounts in East Africa is higher than that of the WAEMU. This study attempts to understand the factors driving the adoption and the use of mobile financial services in the WAEMU compared to East Africa. To achieve this, micro-level data from the 2017 Global Findex database are used to perform probit and multinomial logit estimations. The findings reveal that the same determinants influence the adoption and use of mobile money accounts across the populations of both groups of countries, specifically those related to the least vulnerable social categories (i.e., males, older, more educated, richer and part of the workforce). Therefore, in comparison to East Africa, the delay in the penetration of mobile money accounts observed in the WAEMU may be attributed to insufficient policies for increasing the awareness of the benefits of mobile financial services. The study ...

Sustainability

Purpose—This research discusses emerging trends in financial inclusion, barriers and factors influencing mobile banking as an innovative solution for increasing financial inclusion in sub-Saharan Africa (SSA) with a specific focus on Nigeria. Design/methodology/approach—Using a qualitative meta-synthesis (QMS), an interpretivist research paradigm, authors provide an analytical tool for understanding the subject of inquiry by integrating findings from previous studies and relevant data from the reports of the Central Bank of Nigeria on emerging trends in financial inclusion. Findings—Three major factors emerged as drivers of mobile banking in Nigeria: (a) the ease of using mobile devices for personal banking transactions including prompt information about users’ financial transactions (savings and withdrawals) immediately through SMS (short message service) alert (easy management of my account); (b) the security/safety concerns of theft and cyber fraud; (c) social influence of friend...

Journal of Mgt. Science & Entrepreneurship, 2019

This study aims to investigate the relationship between agent banking, mobile money operators and financial inclusion in Nigeria. For the purpose of this study, a descriptive research design was used. The study population were operators of agency banking and mobile money services located in Jos town and environs. Primary data was gathered through structured questionnaires. Test-retest technique was employed to determine the internal consistency of the instruments by computing Cronbach's alpha. A Cronbach's alpha of 0.619 and above was taken as acceptable reliability. Linear regression was used to analyse the data to determine, if agency banking, mobile money operations had a significant relationship with financial inclusion and to indicate the relative strength of the independent variables on the dependent variables. Findings revealed that, that cybercrime and reduction of cost of banking services had a statistically insignificant and negative relationship with financial inclusion, while geographical coverage and illiquidity had a positive, but insignificant relationship with financial inclusion. This study concludes, that agent banking and mobile money is gaining wide acceptance, however this has not engendered, more financial inclusion. This study recommends, that the government should create an appropriate regulatory Hummingbird Publications

International Journal of Management Studies, 2018

Financial inclusion is a measure of the proportions of individuals and firms that use formal financial services. It serves as a vehicle for poverty alleviation and the driving force for the achievement of the global sustainable development goals (SDGs). The purpose of this study was to find out the progress achieved pertaining to financial inclusion in Ghana. The government of Ghana has for the past years consciously put in place policies and programs to facilitate the promotion of financial inclusion. These policies have resulted to rapid expansion of the banking sector thereby making formal financial services accessible to all. The expansion of bank branches, ATM coverage, increment in Debit/Credit cards ownership and mobile money account holders are indications of achievement in the financial inclusion agenda. An estimated 83.1% of Ghanaians have mobile money account, which has taken savings and other forms of financial services to the doorstep of the ordinary citizen. This has also resulted to a rise in the level of making/receiving payment digitally from 22% in 2014 to 44% in 2017 among rural dwellers. Bank branches coverage per 100,000 adults has grown from 4.8 in 2008 to 7.2 in 2016. Because of the branch visibility, account ownership has also seen a surge especially, in the rural areas where it used to be minimal. Although there has been some success, there is the need for the government to continue with the provision of an enabling environment for faster progress since achievement of financial inclusion enhances stability and faster economic growth.

2017

IJMRAP, 2021

Purpose-The purpose of this study was to determine the factors influencing the increase in mobile money transaction in Ghana. Design/methodology/approach-A descriptive quantitative research approach was used. Convenience sampling method was adopted. Data collection was done through the use of structured questionnaire involving Likert-Scale type of questions. Findings-The study identified that mobile money users in Ghana are influenced by the process involves in the use of mobile money services, the registration process and the speed of the process, time saving, paying bills and other utilities, and the reliability of the mobile money services to use mobile money services. Mobile money users in Ghana prefer mobile money transactions to banking transactions because mobile money transactions are less expensive, it is easy to perform, mobile money transaction is fast and save time, and it has more outlets than banking outlets. Practical implication-The findings advise mobile money operators in Ghana to use the identified factors to increase their customer base. Banks are to pay attention to the identified factors that have made mobile money users in Ghana to prefer mobile money transactions to banking transactions when designing new banking services. Originality/value-Finding the factors influencing the increase in mobile money transactions, and finding out why consumers prefer mobile money transaction to banking transaction in Africa using data from the Ghanaian economy as there is no unified view concerning factors influencing the increase in mobile money transactions.

Heliyon

This study examines the effect of mobile money transactions on banking sector performance in Ghana using monthly data for the period 2015-2020. A composite index of banking sector performance was created from three indicators namely; depth, stability and efficiency of the banking sector. Using the Autoregressive Distributed Lag (ARDL) bounds test for cointegration, the Error Correction Model (ECM) and impulse responses analysis, the findings revealed that mobile money transaction has a detrimental effect on banking sector performance. Findings from the disaggregated components indicate that mobile money transactions hurt banking sector efficiency, while its effect on banking sector depth and stability is insignificant in the long run. It is concluded that the implication varies from one indicator to another concerning the direction and magnitude of the influence. The study, therefore, recommends that banks exercise much caution in their decision to consider adopting mobile moneybased services when designing their business models.

Scientific Annals of Economics and Business, 2023

The study investigated the relationship between mobile money growth and banking development in Sub-Saharan Africa. The question of whether mobile money threatens or supports traditional banks is contentious. Therefore, the motivation was to comprehensively examine the extent of mobile money's influence on banking development. The study used a quantitative research design with aggregated quarterly panel data from the four regions of Sub-Saharan Africa. The Panel ARDL estimation was applied to quantify the nature of the relationship between mobile money and banking development variables. Study findings showed that an increase in active mobile money accounts and volumes was associated with a decline in bank accounts, bank branches, and ATMs in the long run. At the same time, this trend was offset by positive impacts on private sector credit and total bank assets again in the long run. The findings align and extend the technology acceptance models and show that increased use of mobile money technology has substitution and complementary effects on banking development. Policymakers and financial institutions should carefully consider the potential trade-offs and synergies between mobile money adoption and traditional banking services, leveraging the positives while addressing challenges arising from the disruptive forces of technological innovation.

2016

Mobile money in Zimbabwe has extensively extended the frontiers of financial inclusion to reach millions who were earlier excluded within a relatively short space of time. The growing use of mobile phones in transferring money and making payments has significantly altered the countrys financial inclusion landscape as millions who had been hitherto excluded can now perform financial transactions in a relatively cheap, reliable and secure way. The FinScope results found out that 45% of the adult population use mobile money services. Of those using mobile money, 65% mentioned that is convenient, while 36% mentioned that it is cheap. Mobile money is accessible. These drivers are in the backdrop of few or no bank branches in rural communities as well as time and cost of accessing the bank branches. In Zimbabwe, mobile money is mostly used as a vehicle for remittances. While some people are enjoying mobile money services, it is important to mention that there are still people who are excluded from the formal financial system. The reasons why people do not use mobile money are mainly related to poverty issues. Mobile money remains a viable option to push the landscape of financial inclusion in Zimbabwe and other emerging markets where the formal financial system might not be strong.