Mobile money usage doubles in 3 years — EFInA

Enhancing Financial Innovation and Access (EFInA), an organisation that promotes financial inclusion, has disclosed that mobile money and financial service agent usage has doubled over the last three years, highlighting technology’s growing role in nationwide financial access.

It revealed this in its ‘Access to Finance 2023 survey,’ stating that the increase in formal financial service usage is primarily driven by growth in the nonbank sector, even as the ecosystem remains predominantly bank-led.

“Among Nigeria’s 111 million adult population, banks continue to serve the largest group, with 58.3 million users, up from 54.6 million in 2020. However, mobile money providers rose to 12 million from 5 million while financial agents rose to 60 million from 29 million,” EFInA said.

The report further disclosed that while mobile money awareness levels remain relatively comparable to 2020, there has been a significant increase in conversion to usage in 2023.

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It said “Approximately 40 percent of those aware now use compared to less than 10 percent in 2020. The result revealed that perceived ease of access, speed of transactions, return on savings, and low charges have a significant influence on the user.”

The organisation added that 62 percent of mobile money users now use their account at least weekly, up from 35 percent in 2020. This frequency of use, particularly in comparison to traditional bank accounts, suggests that mobile money is becoming increasingly relevant for managing daily financial needs, offering greater convenience and accessibility to Nigerians.

Despite these positive trends, challenges remain, the report said. “Service reliability, particularly in remote areas, and failed transactions were cited by 34 percent and 21 percent of mobile money users, respectively, as major issues.

“Additionally, for those who are aware of mobile money but have not yet adopted it, a lack of trust remains the primary barrier, affecting 27 percent of this group. Other obstacles include limited knowledge about mobile money, how it works, and how to access it,” EFInA stated.

According to GSMA, Sub-Saharan Africa (SSA) has continued to lead global mobile money adoption. Growth in Nigeria, Ghana, and Senegal has made this possible. In 2023, SSA’s mobile money market was worth $912 billion.

In its recently released ‘The State of the Industry Report on Mobile Money (2024),’ GSMA, the global association for telcos, said, “Mobile money is often considered an African success story, and in many ways, it is. Sub-Saharan Africa has the highest levels of mobile money adoption in the world.”

Since 2013, the number of registered mobile money accounts in Nigeria has doubled. In 2023, over a third of new registered and active 30-day accounts globally were from Nigeria, Ghana, and Senegal. Regulations in Nigeria have driven growth in mobile money agent networks globally since 2022.

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GSMA noted that OPay and PalmPay are the most prominent non-MNO-led mobile money providers and have gained significant market share in Nigeria since receiving their MMO licenses. As of October 2023, OPay was the most downloaded app in the country, with over 30 million users, over 500,000 agents, and around 300,000 merchants.

PalmPay had over 30 million registered accounts, half a million registered agents, and 600,000 merchants as of the end of 2023. “The growth of non-MNO-led mobile money providers in Nigeria has driven financial inclusion, alongside the rising use of PSBs,” GSMA said.

Data from the Nigeria Inter-Bank Settlement Systems (NIBSS) has revealed that licensed mobile money operators, including Opay and Palmpay, processed transactions worth N46.6 trillion in 2023, marking the highest annual mobile money transactions in Nigeria,

According to NIBSS, this represents a 140 percent increase from the N19.4 trillion recorded in 2022. Additionally, the volume of mobile money transactions surged by 326 percent, rising from 714 million in 2022 to 3.04 billion in 2023.