GSMA hails mobile money resilience during Covid-19 - Mobile World Live

GSMA hails mobile money resilience during Covid-19

24 MAR 2021

Industry association GSMA recorded a significant jump in the value of transactions made via mobile money services and a rise in account registrations in 2020, but warned of hurdles for providers to reap the benefits during the Covid-19 (coronavirus) pandemic.

In its annual State of the Industry Report on Mobile Money, the association estimated total global transaction values were up 22 per cent year-on-year to $767 billion. Daily processed transactions were more than $2 billion, an industry-first.

The GSMA noted the pandemic led more people to use mobile money as a safer option to make payments instead of handling cash, with registered accounts hitting 1.2 billion, up 12.7 per cent.

More flexible processes introduced by regulators and easier account opening options also contributed to the rise.

The association also found more than 300 million mobile money accounts were active every month, suggesting more people are moving away from the margins of financial systems and embracing digital services.

Agent numbers increased 14 per cent, which the GSMA stated was the highest annual rise in the last three years.

International mobile money remittances rose by 65 per cent, with more than $1 billion sent and received monthly.

Regulatory landscape shift
For providers of mobile money services, the pandemic brought a more complex environment as consumer spending slowed “dramatically”, with the introduction of fee waivers by some regulators resulting in a decline in revenue.

Consequently, providers “found it difficult to reap the commercial benefits of higher mobile money usage and a widespread shift from cash to digital”.

The GSMA warned prolonged waivers across all types and bands of transactions would result in a negative impact on core revenue streams for mobile money providers.

“Unlike traditional financial service providers, which can intermediate customer deposits through lending or investment, mobile money providers do not enjoy these rights and depend primarily on transactional revenues to sustain their businesses”, it explained.

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Yanitsa Boyadzhieva

Yanitsa joins Mobile World Live as a Reporter based in London. She has more than 5 years’ experience at various media outlets in her home country Bulgaria. She started her career as a political reporter, followed by taking editor roles...

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