Check the YouTube comments sections of Taylor Swift’s “willow” or Harry Styles’ “watermelon sugar” and what you see is “who’s here after they won…”

It shows that recognition has a way of increasing demand and I wonder how that plays out in the financial services sector. Industry trackers, like GSMA’s annual report on the state of mobile money, give a sense of the countries and companies advancing financial inclusion in the world.

The report is arguably the most referenced in financial inclusion research; it might as well be the industry’s version of the Grammys (without the after parties). So who scooped the top prizes in 2020 and what new demand can we look forward to?

More MoMo 

136 million new accounts were created within the year to increase the total number of registered accounts to 1.2 billion. At least 300 million of those accounts were used actively on a monthly basis — an unprecedented figure in mobile money history.

What were those accounts actively used for? A major one was remittances.

About $1 bn was processed per month in 2020 between the 310 live mobile money services available in 96 countries, per the GSMA.Total international remittances done through mobile money increased by 65% – from $7.7 bn in 2019 to $12.7 bn in 2020. 

The COVID-19 pandemic was partly responsible for the increase in outbound remittances. As the world went into lockdown, bank branches closed, locking many people out of the money transfer systems they were familiar with. So individuals signed up to become mobile money agents to help people send and receive money across the world. 

There are now at least 4.8 million active agents around the world, an 18% increase over 2019.

Africa remains the MoMo base

There are 159 million monthly active accounts in Africa; this figure represents more than half of the global total. South Asia trails behind with 66 million active accounts.

The salient point is that agents are becoming more capable of delivering services that, historically speaking, only banks could deliver in Africa. In many cities, agents wielding POS devices are empowered to offer financial services, such as bill payments and credit, to their end customers. 

[ Read: How “POS shops” fill the gap left by banks and ATMs in Nigeria ]

If mobile money works well for digital cash transfer, what else can it be good for? 

At the GSMA event, where the 2020 State of the Industry Report was launched, Ralph Mupita, the CEO of MTN, said insurance would be the next product to be distributed through mobile money’s infrastructure. As the logic goes: what’s good for the underbanked is good for the underinsured.

Before we get high on performing inclusion…

It is worth noting that insurance is quite a different product from payments or cash transfer. Remittance is a more frequent and intense need than insurance. 

Also, pretty much everyone in the world is convinced of the value of sending and receiving money. That high-level ideological buy-in does not yet exist for insurance, especially in low-income countries. Case in point: Nigeria.

But Mupita could be on to something. Perception and demand change when people begin to see possibilities. 159 million monthly active mobile money accounts in Africa can definitely be a springboard for a better insured continent.

If you read one piece about an African woman in tech this month, it should be this feature on Ebi Atawodi, Netflix’s new director of payments for the EMEA region. Edwin got her to talk about how she combines scuba diving with a relentless drive to be first class professional.

Question: which telco became the first in East Africa to switch on 5G? You probably guessed right.

And what is it about open banking that has got fintechs excited in Nigeria? All about that, here.

The nature of mobile money makes it easier and cheaper for women to access them over traditional financial institutions accounts. 

In Kenya, women are able use M-Pesa to buy food from a local merchant or pay their children’s school fees. They are also able to buy government bonds through M-Akiba. Mobile money offers increased privacy and security for women meaning they don’t have to worry about remittance agents violating their privacy and informing their husbands about the frequency of their transactions.

Women make up the majority of remittance recipients globally and access to mobile money has helped fuel that. Also, mobile money helps women-led households to exit extreme poverty. 

According to the Science research, an area which went from zero to six M-PESA agents would have 22% fewer women-led households living in extreme poverty than an area of the same size in which no new agents entered during the same time period.

Despite the benefits of mobile money on financial inclusion among women, many who are unable to afford mobile phones and are digitally illiterate are unable to access it. It will take more than technology to close the gender gap. A combination of supportive regulation and women-sensitive products will make a huge impact.

Written by Olanrewaju Odunowo