A report by the Egyptian investment bank EFG Hermes shows that Sub-Saharan Africa still leads in the uptake and use of mobile money and digital banking services. The report dubbed Mobile: Deepening Financial Inclusion But at a High Cost shows that Kenya, Rwanda and Ghana are perched at the top in various aspects and remain among the savviest mobile banking countries in the world.
Kenya is the global leader in mobile banking
Kenya still leads the world in mobile banking. The report shows that 72 percent of banked Kenyans use their mobile phones to access and transact on their bank accounts. This is almost three times the global average of 25 percent. It means seven in every 10 Kenyans use a phone to transact instead of going to a brick and mortar bank.
Most Kenyans use mobile money to transfer cash as well as save. Mobile money pioneer MPESA is the most popular, and there are Airtel Money and T-Kash by Telkom. Most banks collaborate with at least one of the three telcoms to ease access of credit and loans to individuals and businesses. It is easy today to get loans using SSD when one does not have a smartphone, while lenders have digitized most of their services.
The cost of using mobile money however hurts those at the bottom who make up majority of the population. For instance, it is more expensive to send and withdraw KES 500 than it is to send and withdraw KES 2,000, and the situation replicates up the ladder. Kenya is therefore poor in ensuring financial inclusivity when compared to Ghana and Rwanda. Kenya has a mobile money penetration of 105 percent.
Ghana and Rwanda lead the world in mobile money penetration
Ghana and Rwanda have the highest mobile money penetration percentage in the world. Penetration currently stands at 152 percent in Ghana and 142 percent in Rwanda. This is due to the fact that most bankable adults who own mobile phones have more than two sim cards that are enabled and are used for mobile banking.
Like Kenya, the rate of sending and receiving cash is high hence excluding majority of the population, or making it meet the high cost of basic services. Kenya follows the two countries with mobile money penetration standing at 105 percent.
Uganda and Tanzania in matters mobile banking
Uganda follows Kenya in matters mobile banking across the world. 47 percent of Ugandans use their mobile accounts or digital banking accounts to transact, compared to Kenya’s 72 percent. Tanzania follows Uganda at 37 percent.
The EFG Hermes report shows that generally, East Africa leads the world in matters digital and mobile banking. There are tens of mobile loans apps in Kenya alone which give unsecured credit to borrowers.