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What Is The State Of Instant And Inclusive Payment Systems In Africa?

BY Juma · October 26, 2022 09:10 am

KEY POINTS

Mobile money originated in Kenya in 2007 and is a prime example of a digital payment instrument that is instantly available, meeting the distant payment need of both higher-income and lower-income consumers.

KEY TAKEAWAYS

In 2021, 33 percent of the adult population in Africa had a mobile money account, which is up from 23 percent in 2017.

Through access to mobile money, consumers have realized the benefits of using instant digital payments.

AfricaNenda launched a detailed report on The State of Instant and Inclusive Payment Systems in Africa that broke down the digital payment systems in Africa and what they mean to the ever-growing and ever-changing financial sector within and without the continent.

According to the report, the digital payment systems that are about to hit the African continent are likely to bring at least 350 million people to the transaction chain, a move that will in turn widen the efforts to increase financial inclusion within the continent.

“Instant and inclusive retail payment systems can play a pivotal role in creating universal access to financial services for all Africans. The rise of mobile transactions has been a key driver of the substantial gains in the reach of the financial services sector in recent years,” said the report.

The report notes and acknowledges the role Kenya has played in the amplification of digital payment systems in Africa through mobile money innovations.

“Mobile money originated in Kenya in 2007 and is a prime example of a digital payment instrument that is instantly available, meeting the distant payment need of both higher-income and lower-income consumers,” said the report.

According to the report, the ability to make and receive payments via mobile wallets, especially over distance for remittances, has been the main driver of financial inclusion.

In 2021, 33 percent of the adult population in Africa had a mobile money account, which is up from 23 percent in 2017. Through access to mobile money, consumers have realized the benefits of using instant digital payments.

The report notes that there is a need to bring more African population into embracing the use of digital payments. It notes that 54 percent of Africa’s adult population still prefers cash for payments

Cash is instant, does not require electronic devices, and can be perceived to be free or at least lower cost by consumers. However, cash has safety drawbacks, among other disadvantages, and the transition to digital payments has continued to increase: roughly 41% of adults in Africa with transaction accounts made a digital payment in 2021, compared to 27% in 2017.

Download the report here.

Related Content: Digital Payment Systems About To Hit Africa And Bring Out The Glory

Juma is an enthusiastic journalist who believes that journalism has power to change the world either negatively or positively depending on how one uses it. (020) 528 0222 or Email: info@sokodirectory.com

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