
How Sierra Leone can join West Africa’s mobile money revolution
Mobile money is booming in West Africa because of extensive market liberalisation and enabling regulatory frameworks. Sierra Leone can learn from its neighbours and build reliable infrastructure, reduce e-levy, push for financial literacy and consumer protection for increasing the take up of mobile money.
West Africa has recently emerged as mobile money’s new powerhouse, overtaking the historic frontrunner, East Africa. Between 2013 and 2023, regional registered mobile money accounts doubled – a growth mostly driven by Nigeria, Ghana, and Senegal. From 2018 to 2022, the West African Economic and Monetary Union (WAEMU) saw the addition of over 110 million mobile money accounts, boosting financial inclusion from 56% to 71% among its 137 million residents, 60% of whom live in rural areas.
This regional momentum sets the stage for exploring what Sierra Leone can learn from peer nations in West Africa and what steps the country could take to join this mobile money revolution.
In Sierra Leone, only 24% of the adult population had an account at a financial institution or a mobile money provider in 2019. Taking only traditional banking services into account, this figure drops to 12%. Limited financial access is a key barrier to entrepreneurship in the country. A 2021 study by the United Nations Capital Development Fund (UNCDF) and Sierra Leone’s Department of Science, Technology, and Innovation (DSTI) found that over 66% of entrepreneurs relied on personal savings for start-up capital.
Mobile money has the potential to be a transformative force driving financial inclusion for adult citizens and by opening alternative funding opportunities to entrepreneurs and small businesses.
What can Sierra Leone learn from other West African countries?
The key enablers of mobile money’s expansion in West African countries have been extensive market liberalisation and the adoption of enabling regulatory frameworks. Examples of successful policies adopted within the region include the licensing of emerging fintechs by the BCEAO (the Central Bank of West African States). Wave Money became the first non-bank, non-mobile-network operator (non-MNO) to receive an e-money licence in the WAEMU market. Shortly after, BCEAO granted an e-money licence to SAMA Money in Mali. This marked a turning point for the entire mobile money landscape, allowing non-mobile-network providers the same regulatory freedoms as MNOs, thereby creating new opportunities for fintechs.
Unlike countries in East Africa, West African countries have hence seen the rise of more non-MNO competitors, introducing new dynamics and challenges for MNO incumbents. These fintechs have created ‘network agnostic wallets’ that are able to capture significant market share. The spurred competition has led to a dramatic drop in transaction fees (for example, from 6-10% to less than 1% in Senegal) together with a growth in use cases. The lower fees have encouraged even very small businesses to start accepting mobile money payments in an economy where cash remains prevalent. However, this “1% model” raises concerns about long-term sustainability, as its viability depends heavily on venture capital funding.
Another key policy example from West Africa is the introduction of the Payment Service Bank (PSB) licence by the Central Bank of Nigeria. Modelled after India’s payments banks, the mobile money licence allows non-bank institutions to offer services such as deposits, withdrawals, cross-border remittances, and debit cards, with the goal of expanding financial access to remote and vulnerable populations. To obtain the licence, institutions must demonstrate their ability to reach rural customers through last-mile distribution networks, with at least 25% of operations required to be in rural areas.
What can Sierra Leone do to foster its mobile money ecosystem?
Sierra Leone still faces several barriers that limit the pace of progress in leveraging mobile money for financial inclusion. Although internet penetration is on the rise, challenges remain in the coverage, quality, and affordability of services. In 2022, only 21.5% of the population used mobile internet, while 15% had no access to a mobile phone signal. Low interoperability, an unsupportive policy and legal environment, very low levels of financial literacy, and inadequate electricity connectivity further challenge the uptake of mobile money in the country.
The government and central bank of Sierra Leone have a critical role in nurturing the growth of the country’s mobile money ecosystem. Creating an enabling environment requires formulating an overarching policy and regulatory framework that supports and incubates the emergence of new fintech business models while mitigating risks through necessary safeguards. Targeted recommendations for nurturing such an environment include:
- Ensure the presence of reliable infrastructure. It is crucial to invest in both physical (such as electricity and mobile networks) and financial (such as payment systems with interoperability between providers) infrastructure. Interestingly, a recent study across 42 African countries reveals a trade-off between interoperability and network coverage. While platform interoperability benefits consumers by decreasing user fees, the increased competition is found to discourage infrastructure investments by mobile network companies, particularly in rural and poor areas, which in turn hinders financial inclusion. Combining interoperability with rural telecom subsidies is shown to deliver lower fees without hurting coverage.
- Reduce sector-specific taxation and minimise tax-induced barriers. Evidence from Ghana and Tanzania shows that additional taxation on mobile money, despite seeming like a convenient revenue-earning opportunity, ultimately reduced transaction volumes and financial inclusion, leading to lower overall tax revenue (see Figure 1). As noted in an earlier IGC blog, the real benefit of mobile money for tax revenue is not via taxing but via information. Tanzania eliminated its mobile money levy in June 2023, while Ghana reduced its e-levy in January 2023.
Figure 1: Impact of e-levy on mobile money transactions in Ghana, 2021-2023

- Embed digital financial literacy in national financial inclusion frameworks and strategies. Investments need to target programmes that develop digital and financial literacy skills among underserved and vulnerable populations. Over the past couple of years, several African regulators have started integrating such initiatives in their financial inclusion strategies. Notably, the Central Bank of Nigeria has been revising its national financial education framework to address the evolving financial landscape and provide guidance on using digital payment banks and fintechs. Collaboration with financial services stakeholders, including mobile money providers, is crucial when implementing financial literacy programmes – for instance, 9PSB in Nigeria partnering with the Lagos State Employment Trust Fund.
- Foster consumer protection. Strengthening consumer protection is essential for building trust in the mobile money industry. Alongside digital financial literacy, fraud mitigation strategies by mobile money providers play a key role. Several consumer protection frameworks are currently under development: examples include the Bank of Zambia and the Central Bank of Nigeria envisaging the use of artificial intelligence chatbots to educate and assist consumers and the BCEAO planning to roll out a region-wide consumer protection policy.
Why Sierra Leone is poised to leverage mobile money
Sierra Leone’s journey towards digital financial inclusion holds immense potential. The country has made significant strides in the adoption of digital financial services, with the adoption rate rising from just 9% in 2017 to an estimated 30% of the adult population by 2019 – one of the fastest growth rates in the region.
The introduction of the National Payments Switch in 2023 represents a major step forward in advancing financial inclusion. This new payment infrastructure enables interoperability across banks, microfinance institutions, MNO-led mobile money providers and fintechs, which is expected to enhance competition and efficiency in the payment ecosystem. Additionally, partnerships between microfinance institutions and MNO providers like Orange Money and AfriMoney are expanding access to digital credit. The Bank of Sierra Leone's web-based Collateral Registry, launched in 2017, allows registration of both movable and immovable assets to secure loans, thus broadening access to credit for SMEs. Regulatory reforms are now needed to ensure these new systems function effectively and sustainably.
Innovation is unfolding rapidly in Sierra Leone. For example, Revolut recently announced the expansion of its Mobile Wallets feature to integrate new payment routes, including Orange Money in Sierra Leone. Moving forward, these opportunities need to be harnessed with agility, and mobile money and digital financial services placed at the core of the country's financial inclusion strategy.