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Africa Mobile Money Market


Information & Communications Technology
Mobility & Telecom

The Africa Mobile Money market in has competently established itself as one of the fastest growing markets globally and is expected to exhibit a growth of 39.2% between 2015 and 2020. With mobile phone becoming a consistent communication and content access medium, mobile money services are becoming highly popular among the people. From its onset in the year 2007, mobile money has evolved from providing payment transactions though Short Messaging Services (SMS) and Systems Tool Kit (STK)/Unstructured Supplementary Service Data (USSD) to the more contemporary Near Field Communication (NFC)/smart card transactions. Moreover, the person-to-person nature of payment continues to be the most widely used payment method in mobile money services, while both remote payments and proximity payments remain as broadly used location-based payments. In addition, the widespread acceptance of mobile money services across various countries, the large number of mobile users, and the increased convenience of faster monetary transactions over mobile phones are the primary reasons for the growth of the market.

Today, the extensive usage of mobile phones has redefined people’s lifestyle. The ease of availability of feature-rich mobile phones, supplemented with enhanced network connectivity, has expansively enhanced the functionalities of the mobile device. The prominent development in mobile device usage is the access to financial services over the mobile phone. These financial services are popularly referred to as “mobile money” and have been instrumental in revolutionizing the mobile industry. With regards to Africa mobile money market, the mobile device has evolved from merely a communication device to a financial payment and monetary transaction medium.

Mobile money can be understood as a financial service which provides mobile phone users visibility and accessibility to their monetary transactions over their mobile phones. With mobile phones becoming an integral part in the lives of people, the advent of financial solutions on mobile has helped users make faster financial transactions and enhance their overall monetary activities. Africa mobile money market services primarily include transferring funds, sending and receiving money, making bill payments, depositing and withdrawing money, sending and receiving remittances, recharging top-ups, making airtime transfers, paying insurance premiums, purchasing movie and travel tickets, paying in-store merchants, and shopping online. Hence, the multitude of advantageous mobile money service provisions leveraged by users has led to the widespread adoption of these financial services.

The emergence of mobile money services has also opened new business potentials for the chief stakeholders present in the mobile money ecosystem, which include MNOs, financial institutes such as banks, payment processing agents, and payment platform providers, among others. These services have broadly expanded the product portfolios for these stakeholders and have also been influential in boosting their revenues and market foothold in different markets. With the mounting usage of mobile money services by both banked and unbanked customers, these solutions have been chiefly responsible for diversifying and expanding their customer base across different regions and industrial verticals. Hence, the Africa mobile money market service in turn has been highly influential in empowering the business value and success rate for these stakeholders.

The proliferation of mobile devices among users, the indispensable requirement to have ubiquitous access to financial solutions, creation of new business avenues for the stakeholders, evolving demographic needs across Africa, and the increasing use of mobile money services across businesses are some of the factors driving the adoption of mobile money services. However, prevailing data security apprehensions, lack of awareness related to mobile money services, on-going switch to new handsets, and interoperability among devices are some of the factors hindering the growth of the Africa Mobile Money market. While bridging the virtual world with reality and providing enhanced flexibility among mobile money services offer new opportunities to the mobile money service providers; diversified policies and regulations present across various countries pose as challenges for vendors.

The major vendors involved in the Africa mobile money market are Airtel, MTN, MCEL, TIGO, Orange S.A, Unitel, Safaricom, Econet Wireless, Zantel, Vodacom, and Movitel. The key strategies used by these vendors include partnerships and acquisitions to increase their market share and reach in the market.

The threat from new entrants is low for the existing suppliers in the Africa mobile money market, mainly because of the scope of increasing business revenues that the mobile money services offer to the budding vendors venturing into this market. However, the prevailing mobile money vendors face a low-to-moderate threat from substitute products as mobile money is fast gaining preference by the users, when compared to the existing traditional banking services. The presence of limited differentiation in mobile money product offerings in the market gives the suppliers a low bargaining power, whereas end users such as mobile subscribers and banked and unbanked customers have a higher bargaining power.

The study helps to understand the structure of the Africa mobile money ecosystem and is intended to help mobile money service providers, namely, MNOs, banks, payment processing agents, and payment platform providers to serve their customers better. The overall market size in this study has been defined as the direct revenues that are being generated by MNOs, banks, and agents in the form of transaction fees and subscription fees charged to the customers. The overall Africa mobile money market size has been further segmented into transaction mode, nature of payment, location, and type of purchase.

The Africa mobile money market is expected to grow from $2.73 Billion in 2015 to $14.27 Billion by 2020, at a Compound Annual Growth Rate (CAGR) of 39.2% during the forecast period from 2015 to 2020.

Africa Mobile Money Market, 2015–2020 ($Billion, Y-O-Y %)

Africa Mobile Money Market

Source: Expert Interviews, Secondary Literature, and MarketsandMarkets Analysis

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