Mobile Money (MM) is gradually becoming a major means of payment for the unbanked and the underserved in Ghana. The widespread proliferation of MM among the unbanked and underserved is premised on recent advances in handset functionality, chip and mobile network technologies, and upgrade in Point-Of-Sale (POS) infrastructure. These developments have improved the environment for MM solutions, and brought together different industry players, such as banks and mobile money operators to establish MM businesses. The use of Mobile Money services as a means of payment brings a number of benefits to the user including convenience, speed, flexibility and affordability (GSMA, 2013)
Mobile money has seen a lot of innovation over the past few months from 2017, since the launch of MTN mobile money (first telco backed financial service) back in 2009. Ghana has seen tremendous growth in the adoption of banking products, with a marginal increase in the banked to unbanked ratio from 20% in 2009 increasing to about 30% in 2015 to now about 40% of the population banked.
As it may seem, the growth of the unbanked population can be largely attributed to the growth and innovation of Mobile Money. Featuring exciting, and consumer-focused innovation including, bill payments, micro savings and loans powered by third parties, Mobile money interoperability as introduced by the Vice President, wallet to bank and vice versa transfers, pensions and insurance among others. Recently MTNs IPO was somewhat mainly executed on the mobile money platform and allowed people from the underserved population roped into that level of innovation. The mobile money industry in Ghana is now processing millions of cedis monthly and generating direct revenues of over ¢2 billion. with 30 million registered accounts, mobile money has evolved into the leading payment platform for the digital economy in Ghana.
The Number Crunch
Mobile money interoperability upon its launch in Ghana by the Vice President Alhaji Mahamudu Bawumia was an industry upgrade across the continent. In the first seven days after its launch, a total of 28,000 transfers valued at about GH¢2.3 million were made. By the next seven days, the total volume had gone up by about 30% to 36,181 transfers valued at about GH¢3.3 million, representing an increase of over 44% in terms of value in less than a month, there is no doubt the influence mobile money has on today’s financial markets.
Industry experts have touted the prospects of Mobile money and its role in the future of banking and finance and target for a cash-light or possibly a cashless economy. In the first half of 2017, The balance on float soared, standing at GH¢1.8billion, increasing by 21.13% in the first half of 2018, to GH¢2.18billion. In terms of value, in the first half of 2018, mobile money transactions stood at GH¢104.60 billion, representing a 53.31% increment over GH¢68.23billion, which was the data recorded from the first half of 2017, registered mobile money accounts across the three major telcos have – for the first time reaching 30 million as of June 2018 when in 2012, the number stood at a paltry 3.78 million. This shows that between 2012 and the first half of 2018 the number of registered users increased by 694%, outstripping the country’s total population; a development that portends future growth in the mobile money space..
According to data from the BOG, in the first half of 2018, the volume of transaction hit GHC655 million; up from GHC 428.49million in the first half of 2017. This represents a 52.86% increment. While the amount of money mobilized through mobile money reached GH¢2.3b as of December 2017. The amount represents a growth of 84.6% over the December 2016 amount of GH¢1.3 billion. Number of adults who have accounts through either a financial institution or mobile money increased from 62% to 69% between 2014 and 2017. In sub-Saharan Africa, it increased from 54% to 63% within the same period. Interest paid to the over 9million active Mobile Money (MoMo) users in 23 months has hit GH₵98.9million at the end of July 2018.
Fraud has also increased to an average of 43 cases from the 28 cases recorded in 2016 with an average of 28 cases per month. In the first 2 months of 2017,, average of 43 cases per month…almost double the previous year’s average. The Telcos have undertaken several steps to ensure that their systems are robust enough to provide secure service.
Conclusion
The mobile money industry is creating jobs for the agents, service providers and users including Fintech companies, merchants, retailers, and aggregators. The number of mobile money agents at end-December, 2016 was 107, 415; with MTN mobile money contributing 54.0 per cent, TIGO Cash 24.9 per cent, Airtel Money 11.0 per cent and Vodafone Cash 10.1 per cent (PSD Prudential Returns, December 2016). Mobile money is an important vehicle to deepen financial inclusion because it enables people who do not have bank accounts to be roped into the banking system, as any money kept in a mobile money wallet is actually held at a bank. Mobile money clearly holds the key to increasing the banked population in Ghana and the sub region, with more people being banked we can be sure of a healthy financial market.
