Sub-regional Workshop on Mobile Money in West Africa

The mobile money financial services industry is now expanding rapidly in the West African sub-region after its phenomenal growth in East Africa. Experiences of East and Southern African countries confirm that mobile money presents a unique opportunity to encourage and enhance financial inclusion, formalise the informal sector and tap into the domestic savings in rural areas, with a potential to raise economic growth.

This workshop, jointly organised and supported by the Bank of Sierra Leone (BSL) and the International Growth Centre (IGC) offices in Sierra Leone, Liberia and Ghana, brought together government and private sector representatives from Gambia, Ghana, Guinea, Liberia, Nigeria, and Sierra Leone, and built on previous SSA meetings over the past two years in Mozambique and Senegal. Through this workshop, BSI and other central banks in the region  took the next step towards advancing their new guidelines and looked at new areas such as credit services through mobile money. Key emerging policy areas were identified for workshop sessions to address and the IGC identified relevant economic questions that could be addressed by the SSA experience.


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Session 1: Overview of research findings from mobile money research

Mobile Money and West Africa: selective issues and challenges from elsewhere. The discussion will cover Macroeconomic Impact
of Mobile Money and expansion of financial inclusion.


Deputy Governor, Bank of Sierra Leone


Sarah Logan, Hub Economist IGC
Dr. Iyabo Masha, International Monetary Fund


Mr. Ivan Ssettimba, Assistant Director, Bank of Uganda

Research summary – Lessons from East Africa

Efficient financial systems are key to poverty reduction. Inefficiencies reduce the potential for financial inclusion to effectively generate growth and reduce inequality.Traditional banking institutions have high transaction costs and make maintaining savings and deposit accounts very challenging for unbanked and poor households. Distance is an additional factor that hinders rural and remote households from accessing financial services. Kenya success with M-PESA can be attributed to a wide range of factors, but one of the most distinctive aspects was the expansion of the agent network:

  • The roll-out of M-PESA was done through a radically different model to that of a traditional bank. Agents were set up across the country, and not just in high-density areas, which is the approach taken by traditional brick-and-mortar bank branches. After just 4 years, M-PESA boasted 30K agents, 14 million users of M-PESA. By 2015, M-PESA had 130K agents across Kenya and more than 27M users.
  • As a platform for encouraging financial inclusion and improving financial literacy of households, M-PESA has been highly transformative. Illustrating this change has been the shift over time in usage of M-PESA in terms of function for users. Early adopters of M-PESA relied on the service primarily as a means of transferring funds. At most, approximately 20% of early adopter accounts maintained deposits, most others would cash out any funds as soon as they received them. Overtime, that number has increased dramatically with more households holding funds in their mobile-wallets. This suggests that financial inclusion can be leveraged as an experience good, with new users adapting and increasing demand for more sophisticated services, over time.
  • With close to 90-95% of Households now using mobile money for some function, we can now measure the effect of mobile money on different types of households. In particular, we can see that low income households are catching up in terms of financial inclusion in the country. The closing of the gap between low and middle-income households can be captured by resilience measures of financial health and wellbeing:
    • Much of the developed world uses some combination of savings and insurance to smooth shocks of varying intensities (death, illness, drought, disease, fire etc.)
    • In Kenya and much of the developing world, private insurance and public sector safety nets are limited, leaving many low-income households incredibly vulnerable to the negative impacts of such unplanned shocks.
    • Instead, informal insurance provided through sharing social and family networks are used to smooth shocks.
  • The lower transaction costs and higher security for resource transfers, provided by M-PESA, has had a significant impact on the financial resilience of low-income households.
    • Risks are pooled over greater geographic networks. This enables the risks to be pooled across households with very different risk profiles, leveraging the benefits of risk diversification.
    • Remittances and transfers can be paid out much faster and over much larger geographic distances.
  • Research by William Jack and Tavneed Suri shows that differences in consumption smoothing by M-PESA users, relative to non-users, results in a 4.6% increase in consumption of M-PESA users, relative to a 7.4% decline in consumption by non-users, in the event of a shock.
  • Over the last 8 years, the impact that M-PESA has had on Kenya has been the following
    • Poverty reduction of about 2 percentage points,
    • Transformation of occupational choice, especially among women. Women using M-PESA are far more likely to move from subsistence farming toward micro entrepreneurship.
  • Further research is needed to explore the impact on poverty reduction of other mobile innovations being trialled in Kenya including M-Shwari – the savings and credit platform, addition to M-PESA and M-Akiba – an innovative government bond that can be traded over mobile phones.


Session Summary written by Upaasna Kaul, Managing Editor & Hub Economist. 

Session 2: Challenges and opportunities for mobile money - lessons from East and Southern African countries

Panel Discussion of technical experts, policy makers, and private sector representatives from East and Southern Africa.


IGC Country Director Ghana / Mr. T Dainkeh Director Bank Supervision BSL


Mr. Ivan Ssettimba, Assistant Director, Bank of Uganda

Ms. Juliet Kugonzebwa, Senior Manager, Mobile Money Operations, MTN Uganda

Mr. Peter Ntumwa Kalulwe, Compliance Manager, Airtel Uganda

Mr. Joel Pitta, Head of Marketing and Business Support, Carteira Movel, SA – mKesh, Mozambique

Mr. Joseck Mudiri, IFC

Ms. Sarah Logan, Hub Economist, IGC

Session 3: Cross-country learning & experience sharing

Cross-Country Thematic Working Groups on implications of research results and country experiences on:

  • Agent networks
  • Partnerships
  • Customer protection
  • Capital requirements
  • Lending & credit

Plenary discussion

Summary Day 1

Research and day 1 summary

This workshop presents a unique opportunity to concretise the experiences and lessons of mobile-money expansion. Instead of re-inventing the wheel, we can instead learn from the pitfalls and challenges faced and overcome in East Africa. Mobile Money has the potential to revolutionise traditional retail banking throughout much of West Africa.  In day one we outlined the following:

  1. Mobile Money is a clear ‘game-changer’ radicalising both the banking and telecoms sectors
    1. Expanding financial inclusion through mobile platform reduces the need for high-cost, brick and mortar bank branches.
    2. Wider financial inclusion for previously unbanked groups has the potential to greatly reduce poverty, by enabling households to be more resilient to shocks, and enabling households to change occupations. Transfers can be used for insurance and smoothing risks from shocks
    3. As noted in the Kenyan experience, mobile-money also dramatically lowered transaction costs for users themselves.
    4. Continued innovation holds greater promise for expanding services to low-income households. Examples from Kenya include: savings and credit provided through M-SHWARI, and a new mobile-tradable government bond expected to launch later this month, called M-Akiba
    5. In addition to its impact on growth and inequality within each countries, there is a massive potential of cross-border economic linkages being strengthened throughout West Africa.
  2. The barriers to reaping these gains however, still remain. The big challenge for mobile money is developing a flexible and ‘enabling’ regulatory framework.
    1. Regulation needs to address the needs and interests of banking institutions as well as telecommunications companies.
    2. Overly restrictive regulations or in areas where mobile expansion is largely led by the banking sector, mobile penetration is often stifled
    3. Regulation must sufficiently protect for customers, particularly for financially illiterate or partially illiterate adults. At the same time, however, regulations must be flexible enough to allow for innovation and adaptation by Mobile Network Operators.
    4. Regulation must address licensing and compliance requirements for agents as well as MNOs. These should govern the following:
      1. Customer acquisition and registration
      2. Agent acquisition and scale-up
  • Transaction reporting requirements
  1. Theft and fraud prevention
  1. At a more granular level even more basic barriers to mobile money penetration exist as persistent challenges. These include:
    1. Access to infrastructure for electricity and mobile network coverage
    2. Non-standardised documentation or ID cards
  • Low levels of trust in banking institutions



Session summary written by Upaasna Kaul, Managing Editor & Hub Economist

Session 4: Plenary on cross-country learning

Report back on outcomes of cross-country learning group discussions. The discussion focused on 5 key themes:

  • Taxation
  • Coordinating customer protection
  • Regulatory frameworks
  • Agents and cross-border issues
  • Checklist of obstacles, measures, legal and institutional arrangements for a successful Mobile Money System

Session 5: Status of Mobile Money in West Africa

Current State of Mobile Money in the West African Sub-Region: presentation of country cases.

  • Sierra Leone
  • Liberia
  • Ghana
  • Guinea
  • The Gambia
  • Nigeria

Session 6: Country-specific strategy development

Chairs: Dr. Nii Sowa, Country Director, IGC Ghana & Mr. Dainkeh, Director of Banking Supervision, BSL

Session 7: Future research areas

Discussion areas for future research.

Chairs: Facilitators: Country Directors, IGC