‘Why mobile money customers in W’Africa are inactive’

INTERNATIONAL Finance Corporation (IFC), in its latest study, has revealed reasons behind low usage level of digital financial services in West Africa.

IFC, a member of the World Bank Group, observed the phenomenon in many emerging markets, stressing that this poses a key challenge to the expansion of financial inclusion.

The study was based on research in the largest digital financial services market in West Africa, and finds that almost half of all registered users of mobile money accounts in Cote d’Ivoire do not regularly use their accounts. The reasons for this are several, including customers finding the service irrelevant or too costly.

IFC Program Manager for the Partnership for Financial Inclusion, David

Crush, said digital financial services have expanded rapidly in recent years, especially in sub-Saharan Africa, extending financial services to many rural and low-income communities that were previously excluded.

Crush, however, said the challenge now is to make sure products and services are improved to meet the specific needs of new customers.
The research report was produced by the Partnership for Financial inclusion, a joint initiative of IFC and The MasterCard Foundation to expand microfinance and advance digital financial services in Sub-Saharan Africa in order to help achieve global Universal Financial Access by 2020.

Director of Programs, Financial Inclusion & Youth Livelihoods at The MasterCard Foundation, Ann Miles, said: “The research from Côte d’Ivoire is a wake-up call to all of us working to advance financial inclusion. More than ever, digital financial service providers need to understand early and often what it is that low-income clients need and expect in a mobile money account, and then offer that product or service affordably and conveniently.”

The report makes a number of recommendations based on the research findings, including the need to keep prices of digital financial services low, offer a broad range of products and services that cater to customers with irregular incomes, and to ensure good customer education.

Meanwhile, another report by The Boston Consulting Group (BCG) suggested that the use of mobile financial services in sub-Saharan Africa to do such things as pay utility bills and send money to relatives could produce an estimated $1.5 billion in fees for mobile-money providers by 2019.

The report said that sub-Saharan Africans are looking for more-secure ways to borrow and save money and are open to other financial products delivered using mobile phones, including loans and insurance.