Moreover, payments using mobile money are increasingly common in Sub-Saharan Africa, yet millions of adults still receive or make common payments in cash. This points to opportunities to increase financial inclusion through payment digitalization.
Mobile money has become foundational to increasing financial inclusion in Sub-Saharan Africa. East Africa was once the epicenter of mobile money, given the pioneering mobile network operators in Kenya and elsewhere.
These services have become more widely available in recent years, such that by 2022, Sub-Saharan Africa was home to all 12 of the world’s economies in which more adults have only a mobile money account than have an account with a bank or similarly regulated financial institution.
As of 2022, 28 percent of adults on average across Sub-Saharan Africa had a mobile money account. Though there remain a few economies with practically no mobile money adoption, they are the exception. In fact, 20 out of the 36 surveyed economies in the region have a 30 percent or higher share of adults with a mobile money account. This is more remarkable given the developing economy average of 13 percent mobile money account ownership.
Tanzania was an early adopter of mobile money, which was introduced into the country in 2008. By 2014, the first year the Global Findex collected data on mobile money accounts, 32 percent of adults had one, compared with just 19 percent of adults who had a bank account. As of 2021, 52 percent of adults in Tanzania had an account of any kind, with bank account ownership seeing only a modest increase to 23 percent of adults and mobile money account ownership rising to 45 percent.
Though the exact enablers vary, the pattern seen in Tanzania of mobile money driving account ownership growth in recent years is common in many other economies in the region. For example, in 2014, Cameroon—a lower-middle income economy like Tanzania—had an account ownership rate of around 12 percent.
Low-income economies like Malawi and Togo have seen similarly rapid mobile-money enabled account ownership growth since 2014 from 18 percent for both economies, to 43 percent and 50 percent respectively.
As with Cameroon, rapid growth occurred between 2014 and 2017.
As mobile money continues to spread across the continent, its benefits are accruing to new adopters, such that some economies saw a 20-percentage point or more mobile-money-enabled increase in account ownership between 2017 and 2021.
The role of mobile money in an individual’s financial life varies depending on the owner. Some adults only have a mobile money account, and some have both a mobile money and traditional bank accounts. The data also suggests substitution of mobile money to replace traditional accounts in economies such as Malawi and Togo, where between 2017 and 2021, growth in mobile money account adoption occurred concurrently with a decline or stagnancy in bank account ownership.
Mobile money accounts have helped drive greater gender equity in account ownership—at least in some economies. In seven of the 15 economies where more than 20 percent of adults have a mobile money account, for example, women have equal or higher mobile money account ownership than men.
Age equity also appears to be greater for mobile money accounts in the context of gender. Although the gender gap for bank accounts increases as women age, it remains small-to-insignificant for men and women of all ages who only have mobile money accounts.
A Guest Editorial