Mobile Money Is Driving Financial Inclusion, but Beware the Risks
Mobile money products and services have taken off in many parts of the world, to the extent that in some regions they have become more widely used than traditional banking. For example, in five out eight countries in the Southern African region, roughly half of individuals have subscribed to a mobile money service—many of whom do not have a bank account. Similarly in India, the number of mobile money accounts grew by 95% between 2014 and 2019. In the Middle East, fintech is growing by 30% annually and projected to generate $2 billion in investment capital funding by 2022.
The mobile money story is known to have started in Kenya in 2007 and have since spread globally. Mobile money products and services—based on technology that allows people to receive, store and spend money using a mobile phone—have taken off in many parts of the world, to the extent that in some regions, they have become more widely used than traditional banking.
Mobile money services are faster, less expensive and more accessible than traditional financial services, making them an ideal solution for the 1.6 billion people worldwide who have been left out of banking ecosystems. Mobile money is thus contributing to significant social and economic progress for financial inclusion. It also supports globalisation and better upward mobility for underserved communities, to the extent that individuals can easily transact across borders and send money to their loved ones in underdeveloped regions.