Written by Srinivas Nidugondi

The success of mobile money cannot be measured merely by examining service uptake. An equally vital factor is how the service is leveraged and which use cases have come to the fore (or not) and why. The second article in the Financial Inclusion series offers a perspective in this direction.

Key takeaways include…

How Mobile Money is Utilized

As expected, mobile money is largely being utilized for first-generation transactions, such as bill payments, remittances and receiving wages or payments from the government. The latest edition of the Global Financial Inclusion (Global Findex) database has classified these payments into five broad categories namely; payments from government to people (public sector wages, public sector pensions, and government transfers); payments from businesses to people (private sector wages); other payments for work (payments for the sale of agricultural products and payments from self-employment); payments from people to businesses (utility payments); and payments between people (domestic remittances, both those sent and those received).

Breaking it down further, across the world, nearly a quarter of adults receive payments from the government. Globally, 28 percent of adults working in the private sector receive their wages through this medium. In addition, a significant proportion of adults receive payment for the sale of agricultural products through mobile money. Sending or receiving money also remains a priority for customers, especially in Sub-Saharan Africa. Half of the adult population in the region utilizes remittances, which is clearly no mean number.

Utility payments, too, account for a significant share. Globally, 57 percent of adults have made regular payments for water, electricity, et al.

The Many Use-Cases of Mobile Money

1. Government Payments

High-income economies: 23 percent of adults receive government payments.

Norway and Sweden: Up to 25 percent of adults receive these payments.

Developing Economies: The number varies in developing economies, ranging from less than 5 percent to as high as 64 percent (in the Islamic Republic of Iran).

Brazil, Indonesia, the Philippines and South Africa: 20 percent of adults reported receiving these payments.

Europe and Central Asia have a high proportion of adults receiving government payments.

Russia: 12 percent of adults in Russia avail of these payments.

Belarus: 20 percent have been reported in Belarus.

Patterns of Government Payments

Developing Economies
4 percent received government payments over a year. Broken down, this constituted public sector pensions (7 percent) and government transfers (12 percent).

High-Income Economies
Public sector wages accounted for 11 percent, public sector pensions made up 18 percent and government transfers made up 23 percent.

2. Payments for Work

Overall, 28 percent of adults receive private sector wages through this medium.

High-Income Economies
46 percent belong to high-income economies. These customers receive the payment in their accounts.

Women were moderately less likely to receive such wages than men. Both are equally likely to receive it in their accounts.

Developing Economies
24 percent hail from developing ones. Only about half receive the payment in their accounts.

Women are half as likely as men to receive private sector wages, but, equally likely to receive the funds in their accounts.

Upper-Middle Economies
Between 60 and 70 percent of customers in Brazil, China, Russia and South Africa receive the payments in their accounts.

Customers in Mexico, on the other hand, are equally likely to receive these payments in either cash or in their accounts.

Lower-Middle Income Economies
In Kenya, a large share of these payments is received in the customer’s accounts.

In the Arab Republic of Egypt, India, Indonesia, Ethiopia and Nigeria, most customers reported being paid in cash.

3. Payments for Agricultural Products

Developing Economies
This applies to 15 percent of customers in developing economies. Interestingly, 40 percent hail from in Ghana, Kenya, and Zambia.

Most transactions were cash-based, while one in five reported receiving them in their accounts. Notable exceptions to this are Ghana, Kenya and Zambia, where 40 percent of recipients received the money in their accounts, which are largely mobile money-based.

4. Utility Payments

High-Income Economies
77 percent of customers make such payments directly from their accounts.

Developing Economies
53 percent of customers paid for utilities, via either cash or directly from an account.

5. The focus on Remittances

Developing Economies
27 percent of adults utilize domestic remittance services.

The Sub-Saharan Africa Story
45 percent of the population leverages this service. This was especially true of Gabon, Ghana, Kenya, Namibia and Uganda.

The Dominican Republic, Mongolia, the Philippines and Thailand

The share of domestic remittances exceeds 40 percent.

How Accounts are utilized for Digital Payments

Digital payments are, without a doubt, on the rise. Between 2014 and 2017, the number of adults making or receiving digital payments increased by 11 percentage points, from 41 to 52 percent.

Box I:


The Digital Payments Story

While there is little doubt that mobile money usage has witnessed several changes, there are still many miles to go. The report states that this can be achieved in two key ways, namely continued involvement of businesses and active participation by the private sector, developmental organizations and the government. While this certainly has its own share of challenges, the opportunities, too are numerous. The catch is to hone in on the right opportunity at the right time.


Srinivas Nidugondi is Senior Vice President & Head Mobile Financial Solutions at Mahindra Comviva. His LinkedIn profile can be accessed at https://www.linkedin.com/in/srinivas-nidugondi-594871/ 


About Mahindra Comviva

Comviva is the global leader of mobility solutions catering to The Business of Tomorrows.
The company is a subsidiary of Tech Mahindra and a part of the $19 billion Mahindra Group.
Its extensive portfolio of solutions spans digital financial services, customer value management, messaging and broadband solution and digital lifestyle services and managed VAS services.
It enables service providers to enhance customer experience, rationalize costs and accelerate revenue growth. Comviva’s solutions are deployed by over 130 mobile service providers and financial institutions in over 95 countries and enrich the lives of over two billion people to deliver a better future. For more information,
please visit www.mahindracomviva.com

A-26, Info City, Sector 34, Gurgaon-122001, Haryana. India.
Tel: +91-124-4819000 Fax: +91-124-4819777




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