Can we achieve our financial inclusion target through digital payment?

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Digital wallets are poised to transform the way consumers shop and pay retailers, restaurants, and service providers. Early wallets are enabling the convergence of offers, coupons, loyalty, and payments. Successful wallets will enhance the consumer’s commerce experience by delivering more value, greater convenience, and a contextually relevant, compelling experience. We’ve now entered a phase in the evolution of wallets that will attract new entrants from nearly every sector of commerce — from technology companies to financial institutions (FIs) to merchants. Although a few merchants have made their initial foray into the digital wallet space, others are grappling with what to do and most remain on the side lines altogether ………Denee Carrington (A senior Forrester Researcher)

  • While it has often been described as a money transfer product, when mobile money reaches scale it can also be seen as a network infrastructure and platform facilitating the exchange of cash and electronic value between various economic actors including clients, businesses, the government, and financial service providers. …….. Jake Kendall, Bill Maurer, Phillip Machoka, and Clara Veniard,Legal Studies Research Paper Series No. 2011-14


In our quest to have everybody in the financial system, mobile money can help largely. We have the bulk of our people who do not depend on some pay check handed over to them at the end of the month. They also do not have some huge profits coming out of their businesses to pay themselves and some staff. The bank obviously is not a friend to the majority of us; our incomes are also not regular. In some cases we only make a total sale of GHS 20.00 a month. The banks would not want to deal with us; but mobile money can mob up deposits and enable withdrawals at this level of our social setting and by that, bringing us also into the banking bracket.

This articles references some of the key points raised in the Center for Global Development (CGD) Policy Paper 065 June 2015.

It is noted that the extent of intervention needed and when it is needed has been a great dilemma in enabling the mobile payment innovation in many countries. There are so many possibilities; today people can transfer money between their bank accounts and mobile money wallets. However allowing subscribers to be able to directly transfer money across networks is still a no-go area.

You have traders having challenges with people they do business with, asking if they can change their networks in order to accept money transfers. Irrespective of which mobile network’s subscriber one is, transfer across networks shouldn’t be a challenge today in Ghana.

There is clearly no doubt about the huge potential when it comes to the mobile money network drawing in the large marginalized non-banking population. The paper identifies cash on which poor people rely on as the main barrier to financial inclusion, hence they don’t look attractive to banks. Poor people can however be made free by having access to cheaper digital means of payment, hence can now be positioned to be served by the banks.

Today mobile money providers are just not offering transfers and remuneration but also doing insurances and loan services. In our strive to get the larger population financially inclusive via mobile payment, the payment network should not be seen as an extension service to existing subscribers.

Our focus as country should be for us to see it as an opportunity to venture into new areas with digital payment possibilities.

Benefits from Mobile Money Payments

  • The paper noted and it is true that the inception of mobile money payment has helped to diffuse financial services in various economies. For instance here in Ghana today you have ordinary Ghanaians who have no business with the banks, doing financial transactions with from their phones. Children, Market women, Grannies and Granddaddies are all participating in mobile money transfers.
  • The social cost of cash in developing economies like ours was also highlighted. Access to cash is a great challenge in some remote areas in some countries. Digital access however has helped in this regard. The idea of transferring cash from one point to another for trade has been and continues to be a nightmare for bulk traders travelling across the country. They are always at high risk of being mugged. Their monies being securely locked on their phones while they travel is a big relieve for them
  • Also for social interventions such as the LEAP program and School Feeding payments being carried out by government can effectively be facilitated via digital payment.

As a platform, other added values can be created via applications that can integrate with the mobile money ecosystem to serve in other areas.

The Role of The Agent:

The role of the agent is a vital one in the mobile payment network. As long as there is money handling involved, the agent should be seen beyond that SHS leaver sitting in a yellow painted kiosk by the road side.

They have become the facilitators in our quest for digital financial inclusion for all. They must be given the proper training to handle and manage money. In recent times we have heard reports about them being robbed at several locations in the country.

These robberies have forced many of them to close earlier than they used to. So beyond 6pm in certain areas all mobile money agents will be closed for the day. This development could further draw back the growth we seriously seeking. The debate is still on going about how we can best ensure they are protected while they go about their duties in the mobile payment chain.

Aside facilitating money transfers we can seek to qualify some to begin collecting bills payment for ECG, GWCL, DsTV etc.


The Growth Dilemma

At this stage of Ghana’s mobile payment development, where should our focus be?

As suggested by the paper, the likes of MTN Money, Vodacash, AirtelTigo can decide to push for more merchants to accept mobile money payments for goods and services. Research shows that as the number of payment points increases, existing customers of newly enrolled merchants will be forced to make mobile payments.

Both subscribers and merchants should be given incentives to encourage them to use the mobile money platform in new areas of the economy.

We should begin to make payments at  bars and restaurants with mobile money wallet. We should be reserving seats for long journeys on VIPs with mobile money and even paying school fees the same way.



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