As derived from the 2017 Global Findex data Ghana is showing significant growth thus claiming its spot among the most successful and fastest growing mobile money markets in Sub-Saharan Africa.
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In 2014, when the last Findex data was released , just 13% of Ghanaian adults owned a mobile money account. This figure paled in comparison to those of countries like Kenya (58%) and Tanzania (32%), leading many to believe that Ghana would never catch up to its peers. But the latest Findex numbers show that 39% of Ghanaian adults are now mobile money account owners — a three-fold increase that is prompting observers to wonder how Ghana mounted such a stunning comeback.
Ghana’s first mobile money deployments launched to much fanfare in 2009, but the excitement proved short-lived. After three years, only about 350,000 Ghanaians were actively using mobile money accounts where as Tanazana has 8 million active users 4-years after its launch.
As industry leaders and policy makers struggled to determine where they went wrong, they came to focus on the Bank of Ghana’s 2008 Branchless Banking Guidelines. They realized that despite the Bank’s good intentions and desire to promote a more inclusive financial services industry; these guidelines were creating obstacles for mobile money.
Revised regulations spur provider investments
Recognizing the need to revisit the 2008 guidelines, the Bank of Ghana begun drafting new regulations. The central bank then released new agent and e-money guidelines that permitted Mobile Network Operators (MNOs) to own and operate mobile money networks under the central bank’s supervision.
In less than a year, MTN Ghana was aggressively investing in agent recruitment and customer education helping the telco amass 75% of the country’s active accounts. By 2017, Ghana had over 11 million active mobile money accounts, and an explosion of new use cases had made it possible for Ghanaians to do everything from open a savings account to purchase government treasury bills on their phones.
The regulatory reform process that began in 2013 seems to be largely responsible for the state of DFS in Ghana today because it gave MNOs the confidence to invest in new products and agents.
What is the future of Digital Dinancial Dervices (DFS) in Ghana
The fact that mobile money growth in Ghana has accelerated even as it has stalled in countries like Tanzania raises important questions about how far a country can get on smart regulations alone. Whether Ghana will be able to replicate its success in the years to come is an open question, but the fundamentals remain promising. In 2015, The Consultative Group to Assist the Poor (CGAP) argued that Ghana was, in some ways, the most “DFS-ready” country in Africa, with 92% of adults holding a form of ID required to open an account, 95% having basic numeracy, 91% owning a mobile phone and 74% already sending and receiving text messages. These statistics bode well for the ongoing adoption of mobile money.
This is especially true considering that the country’s DFS industry now includes not only mobile money providers but banks, FinTechs and others that are leveraging mobile money account ownership to offer customers a range of new use cases.
Regardless of what lies ahead, Ghanaians are bullish on their country’s transition to a cash-lite future. And a new generation of innovators and entrepreneurs may hold the key.