Nearly half of all consumers in sub-Saharan Africa used mobile financial services this year, translating to a more than three-fold increase in the past six years, Ericsson’s new consumer and market insight report reveals.
The report, titled Mobile Financial Services on the Rise, also highlighted the impact of the Covid-19 pandemic on mobile financial services uptake, with 54 percent of consumers saying that they used mobile financial services transactions more now than before. About 70 percent were more receptive towards mobile financial services as a preferred contactless alternative to cash.
The report draws on research conducted by the Ericsson Consumer and Industry Lab in early 2021. A total of 3 200 consumers were surveyed, across six Sub-Saharan African countries – Senegal, Angola, Nigeria, Ivory Coast, Ghana and Ethiopia. Also examined was the growth of mobile financial services in light of technology and infrastructure gains across the region, as well as the impact of the Covid-19 pandemic on financial behaviour.
Ericsson Middle East and Africa vice-president and head of digital services Lucky La Riccia said the new research underlined the significant empowering role that mobile financial services played in sub-Saharan Africa, both in combating the impact of the pandemic and in fuelling economic development across Africa through the transformational potential of expanded and affordable access to financial solutions.
“Our aim is to support the digitalisation of Africa through technologies such as mobile broadband. Ericsson’s mobile financial solutions support this aim as we accelerate financial inclusion,” said La Riccia.
When comparing 2015 and 2021’s data, mobile money usage has tripled in Ghana, quadrupled in Angola and increased tenfold, from low levels, in Nigeria. The survey showed that consumers in Ghana had the highest usage levels, at 90 percent. This was about 80 percent for Ivory Coast and Senegal, while Nigeria and Ethiopia were still in the early stages of establishing mobile money use. Furthermore, most non-users were now at least aware of mobile money, which was not the case in 2015.
Traffic data confirmed a large uptake, showing sub-Saharan Africa had been at the forefront of the mobile money industry for over a decade, and multi-source traffic data confirmed the technology’s rise in the region. Last year, there were 27.4 billion transactions in the region, an increase of 15 percent within a year.
According to industry organisation GSMA’s 2021 report, the transaction value was $490 billion (R7.3 trillion), almost a quarter more than the previous year. The report also stated that in 2020 there were 157 live mobile money services in sub-Saharan Africa, up 9 percent from 144 in 2019. This was more than half of all live services in the world.
There were now 548 million registered accounts in the region, a 12 percent increase during the past year, making the title “epicentre of mobile money” more apt for the region as it continued to account for the majority of growth, with 43 percent of all new accounts in the world.
Analysing the number of mobile money app downloads was another way of confirming the growth in mobile money usage in the region. One mobile money app in Nigeria started with 7 375 downloads in 2017. Mobile money usage had more than tripled in Ghana, Nigeria and Angola since 2015, and recorded three million by February this year. Another example, a mobile money app in Ghana had a 10.2 times increase in downloads between 2016 and 2021.
Using both banked and unbanked insights from the ConsumerLab study in 2016 showed that mobile money services became the bridge between the banked and unbanked, as a viable substitute for traditional banking services. This year’s study showed that an equal share of those banked and unbanked still used mobile money services on their devices.
Furthermore, mobile money usage correlated with socio-economic class, meaning that socio-economic classes A-B, especially urban men with a smartphone, were the typical adopter. Interestingly, mobile money was not a particular phenomenon among young people or the established middle-aged, as uptake around these services was similar across all age groups.
The report highlighted that users listed faster transactions as the number-one factor that would encourage them to use mobile money services more often in the near future. About 70 percent believed that faster transactions would encourage them to use mobile money services more, while 51 percent highlighted higher security.
Most non-users were now aware of mobile financial services, with as many as eight in 10 saying they were very interested to start using it.
Communications Service Providers (CSPs) were the most popular mobile financial services supplier, with up to 90 percent of sub-Saharan African mobile financial services users now using the technology through these companies.
given.majola@inl.co.za
BUSINESS REPORT