What we know and don't know about the socioeconomic impacts of mobile money in Sub‐Saharan Africa: A systematic literature review

Abstract

Mobile money has been viewed as transformative in developing countries, because it provides basic financial services via mobile phones to people who lack easy access to formal financial services such as bank accounts. Given its accessibility, security, and affordability, mobile money has been increasingly touted as a promising digital solution for socioeconomic development in Sub‐Saharan Africa. Despite its potentially disruptive impacts, research on this innovation remains fragmentary. To take stock of what is known and to advance future research, a systematic review was conducted of 82 empirical academic studies on the socioeconomic impacts of mobile money in Sub‐Saharan Africa. Results show that mobile money, when widely used in Sub‐Saharan African countries, has enabled a wide range of socioeconomic benefits at multiple levels including household welfare, business benefits, community development, financial development, and country well‐being. In addition, the systematic review reveals multifaceted research biases and gaps in the literature and accordingly suggests promising directions for future research.

Improving the resilience of SMEs in times of crisis: The impact of mobile money amid Covid‐19 in Zambia

“…Mobile money (MM) is a convergent digital innovation that orchestrates telecommunications infrastructure ( mobile ) and microfinance ( money ) (Nan et al, 2021 ). From the outset, MM was designed to cater to the financial needs of the unbanked in developing countries (Hughes & Lonie, 2007 ).…”

“…Ever since the remarkable success of M‐Pesa in Kenya, business communities across SSA have started to incorporate MM into their daily transactions including receiving payments, paying suppliers, bill payments, savings and microloans (Nan et al, 2021 ). The predominant business users of MM are SMEs, and the adoption by large firms remains low (Nan et al, 2021 ). This business gap is attributable to several factors linked to the inherent differences between SMEs and large firms.…”

“…MM affords SMEs the digital capabilities to improve the responsiveness of their logistics. On the demand side, MM users can receive customer payments much more quickly and keep daily earnings safely in their virtual accounts (Nan et al, 2021 ). The digitality of MM minimizes SMEs' susceptibility to physical and temporal restrictions (e.g., local lockdowns and limited operating hours/capacity) during the pandemic, because, for example, they do not need to visit and wait in line in a banking branch.…”

“…The literature shows that using MM shortens the time for the purchase of raw materials and enhances the overall supply chain efficiency (Bångens & Söderberg, 2011 ; Horne et al, 2015 ). In short, digital payments vis‐à‐vis customers and suppliers facilitate the flow of materials and financial resources, speeding up the turnover from capital to inventory to receivables (Nan et al, 2021 ). In a time of unrest, where physical contacts are restricted, MM‐enabled digital financial transactions arguably reinforce the resilience of SMEs by improving the rapidity and efficiency of their logistics.…”

Effects of increasing credit limit in digital microlending: A study of airtime lending in East Africa

“…However, randomized experiments can be particularly well‐suited for exploring causal relationships between treatments and outcomes (Babbie, 2020). Such knowledge can lead to robust results (Nan et al, 2020) able to facilitate effective policy‐making (Ilavarasan, 2017) and provide relevant avenues for further research.…”