BEVERLY HILLS, March 24, (THEWILL) – The GSM Association (GSMA) today published its annual “State of the Industry Report on Mobile Money” and revealed that the number of registered accounts grew by 13 percent globally in 2020 to more than 1.2 billion.
The fastest growth was in markets where governments provided significant pandemic relief to their citizens.
The GSMA noted that over 136 million accounts were added in the year, which exceeded last year’s forecasted growth rate by 6.4 percentage points.
In the 2021 State of the Industry Report on Mobile Money, the association revealed that transactions increased by 65 percent and account activity grew by 17 percent to over 300 million monthly active mobile money accounts.
Transaction values also grew across the board as more money circulated. For the first time, the global value of daily transactions exceeded $2 billion dollars, and GSMA predicted it would surpass $3 billion a day by the end of 2022.
For the first time, more than $1 billion was sent and received in the form of remittances globally every month via mobile money.
Despite early fears that transactions would decline as people worldwide suffered job losses and income cuts during the pandemic, it remains clear that Diasporas continued to support family and friends back home.
As a result, the total value of transactions increased by 65 percent to an annual total of $12.7 billion in 2020.
The report said the growths were driven by the COVID-19 pandemic, as lockdown restrictions limited access to cash and financial institutions.
It also stated that the fastest growth was in markets where governments provided significant pandemic relief to their citizens.
As predicted in last year’s State of the Industry report, registered accounts in Africa comfortably surpassed the half billion mark at 562 million.
Sub-Saharan Africa remained at the forefront of the mobile money industry and accounted for the majority of growth. By the end of the year, there were 548 million registered accounts in the region, 159 million of which were active on a monthly basis and transaction volume of $490 billion.
Although absolute growth was highest in West and East Africa, Southern Africa grew the fastest at 24 percent year on year.
According to the report, the value of mobile money merchant payments grew by 43 percent compared to 28 percent in the previous year.
On average, $2.3 billion in merchant payments were transacted per month in 2020, and Quick Response codes became the second-most offered channel for merchant payments after Unstructured Supplementary Service Data.
GSMA’s Chief Regulatory Officer, John Giusti, noted that mobile money was a powerful tool for expanding the financial inclusion of women in low- and middle-income countries.
He said however, across markets, women were still 33 percent less likely than men to have a mobile money account.
“GSMA and its members are committed to closing this gender gap by addressing the barriers that prevent women from accessing and using mobile financial services”, Giusti said.
According to GSMA’s research, the mobile money ecosystem has been strengthened by an increasing number of strategic partnerships established between money transfer organisations and mobile money providers.
The research found that the pandemic gave fresh urgency to the need for regulatory change to facilitate greater digitalisation.
The report said, “In many markets, transaction limits were increased to allow more funds to flow through mobile money. Additionally, as demand rose for non-physical payments, some regulators classified mobile money agents and their supply chains as essential services.
“While some of the regulatory reforms made in response to the pandemic have been positive for customers and providers, the implementation and extension of fee waivers has had a negative impact on mobile money providers’ core revenue stream.”
GSMA emphasised that mobile money providers depended mainly on transactional revenues to sustain their business and encouraged regulators to work closely with the industry to ensure sustainability going forward.