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Enhancing Growth and Productivity Through Mobile Money Financial Technology Services: The Case of M-Pesa in Kenya

Author

Listed:
  • Gladys Wachira
  • Angelica Njuguna

Abstract

Kenya’s financial industry has been revolutionized and progressing to digital transformation since M-pesa, a mobile money financial technology service, was introduced in 2007. An M-pesa account allows subscribers to send and receive payments as well as store money. As the digital system grew rapidly, a high percentage of Kenyan households gained access to this service, subsequently helping the unbanked and underbanked populations toward broader financial inclusion. As an efficient and highly adaptable payments system communicating across all markets in the economy, M-pesa has contributed to financial deepening, hence promoting economic development. This study analyzed the effects of mobile money financial technology services on Kenya’s output growth and productivity. The findings suggest evidence of a structural change in the growth of output and total factor productivity when M-Pesa was introduced. Mobile Money was established to have had a significant positive effect on enhancing output productivity and output growth.

Suggested Citation

  • Gladys Wachira & Angelica Njuguna, 2023. "Enhancing Growth and Productivity Through Mobile Money Financial Technology Services: The Case of M-Pesa in Kenya," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 15(12), pages 1-91, December.
    • Handle: RePEc:ibn:ijefaa:v:15:y:2023:i:12:p:91
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    References listed on IDEAS

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    Cited by:

    1. Shedrine Butali Wamukekhe, 2024. "Exploring Financial Risks in Relation to Performance of MPESA Agents in Rural Areas, Kenya," African Journal of Commercial Studies, African Journal of Commercial Studies, vol. 5(1).
    2. Clarietta Chagwiza & Emmanuel Owusu-Sekyere & Farai Kapfudzaruwa, 2024. "The Effect of Governance on the Relationship Between Research and Development Expenditure and Economic Growth in South Africa," Economies, MDPI, vol. 12(12), pages 1-18, November.

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    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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