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Does Mobile Money Affect Saving Behaviour? Evidence from a Developing Country

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  • Serge Ky
  • Clovis Rugemintwari
  • Alain Sauviat

Abstract

We investigate whether the use of mobile money can help individuals build savings to face predictable and unpredictable life events. Studying the case of Burkina Faso, we use hand-collected data from individual responses to a survey we designed and conducted between May and June 2014. Our main results show that, although it is not possible to detect any correlation between using mobile money and saving for predictable events, it seems to increase the propensity of individuals to save for health emergencies. We also found robust evidence suggestive that using mobile money increases the propensity of disadvantaged groups such as rural, female, less educated individuals and individuals with irregular income to save for health emergencies. In our further investigations, we address the mechanisms underlying individual saving behaviour. We found that safety and the possibility to transfer money within the sub-region associated with mobile money may be factors that increase the propensity of mobile money users to save for health emergencies. Overall, our results are in line with policymakers’ agenda worldwide to increase financial outreach and improve financial inclusion by using mobile technologies.

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  • Serge Ky & Clovis Rugemintwari & Alain Sauviat, 2018. "Does Mobile Money Affect Saving Behaviour? Evidence from a Developing Country," Journal of African Economies, Centre for the Study of African Economies, vol. 27(3), pages 285-320.
    • Handle: RePEc:oup:jafrec:v:27:y:2018:i:3:p:285-320.
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    5. Steinert, Janina Isabel & Vasumati Satish, Rucha & Stips, Felix & Vollmer, Sebastian, 2022. "Commitment or concealment? Impacts and use of a portable saving device: Evidence from a field experiment in urban India," Journal of Economic Behavior & Organization, Elsevier, vol. 193(C), pages 367-398.
    6. Serge Ky & Clovis Rugemintwari & Alain Sauviat, 2019. "Friends or foes? Mobile money interaction with formal and informal finance," Working Papers hal-02000982, HAL.
    7. Jean-Philippe Berrou & François Combarnous & Thomas Eekhout, 2017. "Les TIC : une réponse au défi du développement des micro et petites entreprises informelles en Afrique sub-saharienne ?," Working Papers hal-02148324, HAL.
    8. Loaba, Salamata, 2022. "The impact of mobile banking services on saving behavior in West Africa," Global Finance Journal, Elsevier, vol. 53(C).
    9. Carlos Sakyi‐Nyarko & Ahmad Hassan Ahmad & Christopher J. Green, 2022. "The role of financial inclusion in improving household well‐being," Journal of International Development, John Wiley & Sons, Ltd., vol. 34(8), pages 1606-1632, November.
    10. Jenny Aker & David A Carroll, 2022. "The State of Digital Financial Services in Francophone West Africa," Working Papers hal-03642499, HAL.
    11. Bahia,Kalvin & Castells,Pau & Masaki,Takaaki & Cruz,Genaro & Rodriguez Castelan,Carlos & Sanfelice,Viviane, 2021. "Mobile Broadband Internet, Poverty and Labor Outcomes in Tanzania," Policy Research Working Paper Series 9749, The World Bank.
    12. Chiara, De Gasperin & Valentina, Rotondi & Luca, Stanca, 2019. "Mobile Money and the Labor Market: Evidence from Developing Countries," Working Papers 403, University of Milano-Bicocca, Department of Economics, revised Mar 2019.
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    14. Gregory Mvogo & Christèle Gladisse Awounang Djouaka, 2022. "Effet du mobile money sur la résilience des ménages exerçant des activités génératrices de revenus au Cameroun," African Development Review, African Development Bank, vol. 34(4), pages 459-471, December.
    15. Koomson, Isaac & Bukari, Chei & Villano, Renato A, 2021. "Mobile money adoption and response to idiosyncratic shocks: Empirics from five selected countries in sub-Saharan Africa," Technological Forecasting and Social Change, Elsevier, vol. 167(C).
    16. François Seck Fall & Luis Orozco & Al‐Mouksit Akim, 2020. "Adoption and use of mobile banking by low‐income individuals in Senegal," Review of Development Economics, Wiley Blackwell, vol. 24(2), pages 569-588, May.
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