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Home Business Kenya’s mobile money usage continues to soar, says report

Kenya’s mobile money usage continues to soar, says report

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Kenya’s mobile money usage continues to soar, says report

Steve Umidha@UmidhaSteve

A growing number of Kenyans continue to use mobile money as a fitting means for their daily transactions amid ongoing Covid-19 scare, a new report shows.

The survey by GSMA, an association that represents interests of over 750 mobile network operators globally, notes that during the pandemic, demand for mobile money increased among businesses, governments and new services that previously relied on cash or other payment channels.

“One of the outcomes of the pandemic is that it has prompted mobile money providers to forge stronger, more trusted bonds between customers and other stakeholders in the payments ecosystem,” it reads in part.

Released yesterday, the report dubbed State of the Industry Report on Mobile Money 2021 also indicates that the industry is experiencing a profound and lasting change with mobile money users now than ever before becoming more financially included and moving away from the margins of the financial system.

Akinwale Goodluck, GSMA head of Sub-Saharan Africa said the strong and steady growth suggests that customers are using mobile money in more advanced ways and in all aspects of daily life. 

“This marks a change from the early days of mobile money when the main use cases were bill payments and P2P payments in the form of occasional domestic remittances,” he added.

As of January 2021, for instance, Kenya had some 66.6 million registered mobile money accounts, a figure that has been steadily growing.

In one year, there was a growth of 12.5 per cent, as there were 59.2 million accounts in January 2020, according to Communications Authority of Kenya statistics.

Mobile phone

Kenyans transacted a record Sh450.9 billion on mobile phone in July last year, with the usage boosted by increased uptake of the service due to the Covid-19 pandemic.

Cumulatively, the industry report indicates that total value of transactions in 2020 grew 22 per cent to stand at $767 billion (Sh84.2 trillion) globally.

The period also saw the number of registered mobile money users grow 12.7 per cent to stand at 1.21 billion worldwide which is double the projected growth rate.

Central Bank of Kenya (CBK) data shows that usage rose from $3.6 billion (Sh395.1 billion) in June to $4.18 billion (Sh458.8 billion) in July, the biggest jump ever seen in the sector – attributed to a government measure instituted to curb Covid-19 spread by encouraging the use of mobile money payments.

This saw mobile money service providers remove charges on transactions that are less than $9.3 (Sh1,020) to cushion low-income consumers.

Similarly, transaction fees on payment of bills and transferring cash to bank accounts were also eliminated to discourage the use of banknotes, giving a huge boost to mobile money transactions amid the pandemic.

In summary

    • 2020 was a year like no other. In every region of the world, Coronavirus (Covid-19) triggered a mix of responses. All at once, handling cash, paying for daily essentials and conducting business in person became risky, and more people than ever turned to mobile money as a safer option.
    • Sub-Saharan Africa has been at the forefront of the mobile money industry for over a decade, and in 2020 continued to account for the majority of growth (43 per cent of all new accounts). By the end of the year, there were 548 million registered accounts in the region, over 150 million of which were active on a monthly basis.
    • By December 2020, 64 mobile money providers – roughly one in five – had over one million monthly active accounts. This is up from 30 providers in 2016.This strong and steady growth suggests that customers are using mobile money in more advanced ways and in all aspects of daily life.

Original Source Website: : https://www.pd.co.ke/business/kenyas-mobile-money-usage-continues-to-soar-says-report-70206/

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