The Next Digital Finance Frontier: Filling the Accounts

It is commonly accepted that poor people find value in remote digital payments propositions. A large number of Tanzanians have flocked to emerging mobile payment solutions, whether it is to send money home, facilitate informal business transactions, pay for bills, or buy pre-paid electricity. This has created tantalizing prospects for such solutions to be the spearhead for financial inclusion in a massive scale. The reality, however, is that most digital accounts are empty and serve mainly, if not exclusively, as a pass through for such payments. As a result, current digital financial services (DFS) may be very useful, but have limited transformational potential. This paper explores why the majority of people reject digital accounts as a good store of value.