Listen Now: Exploring the relationship between mobile money regulation and usage


Author: Nqobile Khumalo



In this webinar, Kalvin Bahia, Mariana Lopez, and Kennedy Kipkemboi Sawe explore the main findings of new GSMA research on the relationship between mobile money regulation and usage.

By the end of 2020, there were 1.2 billion registered mobile money accounts, of which a third are used monthly. The number and value of transactions has increased along with having more use cases beyond just airtime and P2P payments. We are seeing more international remittances, digital payments and G2P payments, all of which have been accelerated by the Covid-19 pandemic.

Mobile money has been very useful in closing some of the financial inclusion gap, particularly in middle income countries. From a regulatory framework, the use of mobile money can be seen from a supply side as well as a demand side point of view. Cultural and religious factors, trust as well as income and savings are some of the factors that will impact usage from the demand side. Supply side factors include price, competition as well as agent networks.

The GSMA Mobile money regulatory index benchmarks the different aspects of regulation across 90 countries where mobile money is available. The regulatory index has 6 dimensions, namely:

  • Authorisation
  • Consumer Protection
  • Transaction Limits
  • Know- Your – Customer
  • Agent Network
  • Investment and Infrastructure

There is a statistical relationship between regulation and mobile money usage, the following indicators have a significant positive impact on the probability of using mobile money:

  • Eligibility
  • International Money transfers
  • Consumer Protection
  • Agent Authorisation
  • Affordability
  • Settlement cases
  • Interest payment

Looking further and segmenting the data, evidence from this research by the GSMA found that a more enabling regulatory framework benefits women more than men. More evidence of this positive relationship between mobile money usage and regulation is seen when a country’s Index score increases by 10 points, the probability of women using mobile money increases between 3.5 to 4.5 percentage points.

As mentioned, Covid -19 has played a role in the increased adoption of mobile money. Many of the regulatory responses adopted by governments to support the use of mobile money during the pandemic are in line with the regulatory components that appear to have a significant positive impact on the use of mobile money. The pandemic has also familiarised more people with the use of mobile money and many regulators’ responses have had positive outcomes, such as the relaxation of Know Your Customer requirements and remote onboarding. There has been collaboration between regulators and mobile money operators and you can read more about it here.

Here are more resources you can read on the topic: