In less than a decade, the mobile phone has been transformed from being a luxury that few could afford into an affordable essential of our daily lives. It is estimated that the number of mobile phones in Ghana far outnumbers our total population.
The ease of access to mobile phones and to mobile services is the outcome of the interplay of various factors including regulatory interventions, intense competition among operators and substantial investments by industry players.
Mobile telephony is a fundamental catalyst for sustainable development as well as the economic empowerment of individuals. It is pivotal to Ghana’s socio-economic growth. While mobile technology has eliminated barriers to the way individuals connect with families, do their work and entertain themselves, mobile financial services extends those benefits to driving financial inclusion, which has a multiplier impact that leads to social inclusion, enhanced economic activity, a reduced cash economy and convenience. It is in furtherance of these benefits of the sector that the Bank of Ghana is currently pushing for better regulation of electronic financial services.
MTN Mobile Money, the first Mobile Money transfer service in Ghana, is a key example of mobile financial services and is one of the main architects of the drive towards a cash lite economy as envisaged by the Bank of Ghana.
The advantages of the MTN Mobile Money Service are manifold and explicitly verifiable from its phenomenal success in the financial sector. Since the introduction of the MTN Mobile Money Service in Ghana in 2009, the service has narrowed the pool of unbanked persons in Ghana and signed on more than 1.5 million active subscribers while recording a total of 18.5 million monthly transactions. The MTN Mobile Money Service actively provides employment to 19,500 merchants across the country.
Many MTN Mobile Money merchants across the country see the service as means of ensuring sustainable livelihood. To them, MTN as Ghana’s largest telecoms service provider has greater reach in communities where conventional banks are unavailable and thus remains the preferred financial service provider for both the banked and unbanked in the district.
The introduction of the mobile money service however, was not without challenges. Infrastructure development and expansion drives have been borne largely by telecommunications companies. Slow adaption to and acceptance of mobile money services among many also poses a major challenge to the rollout of the services in certain sectors of the economy.
The Bank of Ghana, the regulator for banking services in Ghana, recently launched The Guidelines for E-Money Issuers in Ghana as part of a broader strategy to create an enabling regulatory environment for convenient, efficient and safe retail payment and funds transfer. A development considered by many as a move to boost confidence in the acceptance of e-financial services.
The future of mobile money is bright. At a recent forum on mobile money and financial inclusion organized by MTN Ghana, one resource person described mobile financial services as a disruptive technology which may revolutionize the way Ghanaians go about their financial transactions.
Suggested measures to improve the industry include introduction of cross-network funds transfer to ensure inter-connectedness, creation of a cyber-forensic institution, and the adoption of a code of conduct, among others.
Today, beneficiaries of the government of Ghana’s social intervention program, the Livelihood Empowerment Against Poverty (LEAP), receive their disbursements through MTN Mobile Money. And in Uganda, the Kampala Capital City Authority (KCCA) has recently signed a partnership with MTN Uganda to enable members of the public and businesses to pay various taxes and levies via MTN Mobile Money.
This aims to provide convenience to the customer and make revenue collection more effective. These and many other such partnerships are needed for the growth and development of the mobile money service in Ghana.
The full potential of mobile financial services remains to be fully recognized. Wider adoption by government, businesses and the wider public will be achieved through extensive education as well the assurance of security and reliable service delivery on the part of issuers.