Page 101 - SAMENA Trends - April-May 2021

ARTICLE SAMENA TRENDS

ARTICLE

Mobile Money: Driving Growth in Times of COVID19

Globally, large parts of the population Households enabled to make contactless
suffer from financial exclusion as transactions
traditional banks fail to provide The major benefit of mobile money,
sufficient coverage. With mobile money especially during the pandemic, is the
as a solution, telcos have risen to the ability of users to perform transactions
challenge. They are ideally positioned to remotely and contactless when the only
capitalize on the growth opportunities alternative would be cash payments.
associated with it. They are already According to a study by the World
trusted brands with a large customer Economic Forum, high mobile phone
base and broad geographical reach. penetration rates in the SAMENA region
Moreover, telcos can let mobile money and the much more extensive availability
services practically “piggyback” on their of mobile money agents (228 per 100k
existing infrastructure, leveraging cost people) vis-à-vis bank branches (11) or
Dr. Alexander Henschel advantages that cannot be matched ATMs (33) globally lead to many people
Managing Director and Global Head by any bank. And since many services gaining quick access to remote paying
of TMT can be delivered remotely, they are less services at a crucial time.
goetzpartners Management dependent on having physical presences Government enabled to provide social
such as branches or ATMs.
Consultants assistance efficiently
With the recent COVID-19 outbreak, the Another big contribution of mobile money
benefits of mobile money have become during the pandemic was the ability of
even more apparent. While many governments to wire cash benefits to
economies have ground to a screeching large number of households. Handing out
halt due to shutdowns and the restriction the benefits in cash requires significant
of public life, mobile money has proven resource effort while traditional bank
to be a lifeline for many businesses and transfers would have left out a large
private individuals. portion of recipients of these government
programs which were at the forefront

Nirnay Mangilal
Manager
goetzpartners Management
Consultants

Illustration 1: COVID-19 Government responses, Source: World Economic Forum

101 APRIL-MAY 2021