With the development of new technologies, mobile usage has become more and more
widespread. Many people use their smartphones for more than one purpose. Nowadays,
mobile phones are not just used for making phone calls or sending text messages. One of
the best examples of integration in mobile technology is mobile payment methods.
The majority of states around the world are classified as either developing countries or
nations. What does it mean? In most cases, they are just catching up with the tendencies
and global changes now. Among countries in the so-called Global South, progress is made
or met with baby steps. What does research tell us about the usage of mobile payment
methods in sub-Saharan Africa? Read on to find out.
According to different studies, many people in the sub-Saharan region are turning to mobile
payment methods, at least more frequently than before. The research, we are referring to
covered six countries in total: Cote d’Ivoire, Ghana, Kenya, Nigeria, Tanzania, and Uganda.
Out of the six nations or states, Nigeria showed the highest rate of activity when it comes to
mobile payments.
The study surveyed 400 young people from all six countries, in the age bracket of 18 to 35.
The research itself relied on an extensive web survey, to gather results. GeoPoll, the entity
responsible for collecting raw data, examined young people’s engagement with different
financial services. The research report came out as part of a wider study, entitled “The State
of Financial Services in sub-Saharan Africa”.
Without a doubt, mobile money services are becoming extremely popular with Nigerian
youth. What are they primarily used for? Paying for Internet subscriptions, for example.
Other top purchases include buying airtime, gambling or streaming live TV.
We have already mentioned that online gambling is one of the most popular ways of mobile money usage.
The rate is particularly high in Nigeria. In relative terms, Nigeria definitely tops
the list when it comes to gambling, more so than any other country on the list. In fact, 63% of
its mobile money expenditure is spent exclusively on online gambling. This is hardly
surprising, as online and mobile casinos are very popular in the entire region. Besides online
casinos, betting is particularly widespread. Put it this way, mobile money is perfect for this
purpose.
According to the findings, 54% of the study’s participants settled their Internet fees using
mobile money payments. Similarly, 53% of young people spent their mobile money on
airtime purchases. Another 53% spent mobile money on buying a premium quality TV.
Again, these statistics account for all six countries, involved in the study.
While mobile money payments are increasingly popular with digital purchases, it is the least
used method for acquiring actual, physical items. These include clothing, groceries,
transportation or non-alcoholic beverages. Among non-digital mobile money purchases,
clothing and groceries are on top of the list. If we look at things in these categories, trans
portation is in the last position.
Debit card payments are quite a popular method of settling different transactions, especially
in Nigeria. Most transactions, made through debit cards include betting, insurance, nicotine
product purchases, and video streaming.
According to GeoPoll, Nigerian youth is again the most active group, in terms of using debit
cards. Despite the relatively high popularity of debit cards, only 10% of all payments went
through credit cards. Generally-speaking, this goes on to show low overall usage rates of
card and mobile money payments, on the entire continent. The sector is still under-
developed, with a lot of underlying potential for growth.
If we look at the actual ranking, debit cards are mostly used for accessing video streaming
services, with an overall 17% rate. Insurance premium is second on the list, with 15%.
Nicotine products are third and gambling is fourth, with 14% and 12% respectively.
Debit cards were least used for transportation and buying beverages or groceries. In both
cases, the preferred form of payment is cash, which is still the prevalent method of settling
any transactions in African countries.