How COVID-19 is impacting mobile money in SSA

As the COVID-19 pandemic continues to spread across the African continent, countries are taking measures to encourage cashless payments through mobile money transfers by waiving charges. Akinwale Goodluck, the Head of Sub-Saharan Africa at GSMA, joined CNBC Africa to discuss the impact of these changes on the mobile economy in the region. Goodluck emphasized the significant role that mobile money plays in sub-Saharan Africa, with nearly half of the global registered mobile money accounts located in the region. Currently, the region processes approximately 24 billion transactions with a total value of around $46 billion USD. The removal or reduction of transaction charges on mobile money transfers by operators and governments has led to a surge in mobile money transactions, making it more affordable for users. This move also fosters business transactions and reduces the risks associated with cash exchanges. In countries like Kenya, where charges were eliminated last year, projections suggest that the sector could contribute up to $185 billion by 2023. However, Goodluck pointed out that the economic impact of the pandemic makes it challenging to predict future projections accurately. While the world is expected to eventually recover from the crisis, the mobile industry is likely to see continued growth, becoming a vital support system for virtual businesses and transactions. The increased adoption of mobile money and the removal of barriers and restrictions are likely to drive the shift towards a cashless economy in sub-Saharan Africa. Transaction limits have been raised, and costs have decreased or been eliminated in several markets, making mobile money more accessible to a wider population. Despite the rapid growth in mobile money transactions, concerns about the efficiency and reliability of mobile money networks have been raised by users. Issues like network downtime and trust deficits could hinder the transition towards a cashless economy. However, Goodluck assured that the industry, in collaboration with regulators, is actively working to address these concerns. Initiatives such as the mobile money certification program by GSMA are helping to improve the standards and reliability of mobile money services in countries like Ghana and Kenya. As operators continue to invest, and regulators promote innovation, subscribers in sub-Saharan Africa can expect a more seamless mobile money experience in the future.