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On the rise: Mobile money in emerging markets
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In 2019, mobile money exceeded the historic mark of 1 billion registered accounts globally, following half a decade of unparalleled growth at an annual rate of more than 25%.
For many, mobile money is the first, and more often than not, the only opportunity, to achieve financial inclusion. Through the service, customers can safely and conveniently send, receive, and store funds at zero or minimal charges. Just as easily as they register their mobile SIM cards, they can open a mobile money account and use points of sale to deposit or withdraw cash. They can also perform many digital transactions, interacting with other persons, businesses, and in some cases, even government agencies. Additionally, they can use the service to recharge their prepaid balances by simply transferring funds from their mobile money accounts. This way, mobile money has not just improved people's lives but has fuelled the digitalization of entire countries.
A case in point is Lagos, Nigeria. While the country's financial hub went into lockdown from March to May due to the current COVID-19 crisis, the local mobile money provider Paga continued to operate, enabling poor communities to resume their, often vital, economic activities. Even governments are starting to realize that mobile money is not just a means of economic empowerment, but as a powerful tool in the fight against the spread of COVID-19. By replacing physical contacts and the exchange of (potentially contaminated) cash with digital remote transactions, a major route for the spreading of the virus can be cut off.
Although no comprehensive data is yet available on the impact of the current crisis on mobile money adoption, it seems clear that once economies reopen, mobile money will resume, if not accelerate its historical growth, moving on to new heights in the years to come.
2) GSMA (2015): State of the Industry Report / Mobile Money, www.gsma.com/mobilefordevelopment/wp-content/uploads/2016/04/SOTIR_2015.pdf
GSMA (2019): State of the Industry Report / Mobile Money, www.gsma.com/sotir/wp-content/uploads/2020/03/GSMA-State-of-the-Industry-Report-on-Mobile-Money-2019-Full-Report.pdf
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3)Washington Post (2020): The coronavirus is upending cash economies. Mobile money could emerge as the winner, www.washingtonpost.com/world/2020/05/15/coronavirus-is-upending-cash-economies-mobile-money-could-emerge-winner/
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