IDEAS home Printed from https://ideas.repec.org/a/diw/diwdwr/dwr10-21-1.html
   My bibliography  Save this article

Mobile Money is Driving Financial Development in Africa

Author

Listed:
  • Katharina Lehmann-Uschner
  • Lukas Menkhoff

Abstract

Mobile money is an innovation that allows financial transactions to be performed via a cell phone. Even in poor regions of Africa, almost everyone has a cell phone; therefore, mobile money could both contribute to the continent’s economic growth and ensure that no Africans are excluded from access to financial services. However, DIW Berlin data from Uganda show that mobile money is actually used less frequently than the number of mobile money accounts suggests. Nevertheless, demand for financial services has increased by 20 percentage points since the introduction of mobile money. At the same time, a fourth of the population—the poorest, in particular— remain financially excluded. In addition to high costs, this is mainly due to the insufficient availability of mobile money in rural areas and a lack of financial literacy. Consequently, to increase the use of mobile money and thus promote economic development in Africa, an appropriate competition policy, requirements for an enhanced network coverage, and financial literacy trainings are necessary.

Suggested Citation

  • Katharina Lehmann-Uschner & Lukas Menkhoff, 2020. "Mobile Money is Driving Financial Development in Africa," DIW Weekly Report, DIW Berlin, German Institute for Economic Research, vol. 10(21/22), pages 253-259.
    • Handle: RePEc:diw:diwdwr:dwr10-21-1
    as

    Download full text from publisher

    File URL: https://www.diw.de/documents/publikationen/73/diw_01.c.790511.de/dwr-20-21-1.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    mobile money; financial development; financial inclusion; consumer protection;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:diw:diwdwr:dwr10-21-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bibliothek (email available below). General contact details of provider: https://edirc.repec.org/data/diwbede.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.