The glossy numbers however only tell part of the story, the real equalizer effect of mobile money has been the impact of the innovation around financial services, where telecom players have churned out multiple use cases cutting across all economic divides in Africa, from simple ones like money transfer and air time top-up to more sophisticated ones like bill payments and bank-to mobile wallet transactions.

As more people overcome the digital cultural shock and become digitally literate they are shopping with tap & pay and other merchant payment solutions, while they also pay their utility bills, cable TV subscriptions and even taxes. Using mobile money significantly increases efficiencies, for instance Dar es Salaam water and sewerage cooperation registered a 38% increase in revenue collections when it started collecting it through mobile money.

Granryd also noted that telecoms have to develop more Non-communication services that ease life and solve problems, while consolidating the existing user-cases, that it is through these new revenue streams that the industry will stay afloat.

Mobile money has become a lifeline to unfortunate members of society, for instance up to 52% of refugees from Nyarugusu refugee camp in Tanzania use mobile money to receive humanitarian cash donations, remittances from home countries as well as wage payments.

Although the innovation was born in East Africa, West Africa has emerged as the new mobile money frontier, where adoption is currently almost 29% of active mobile money accounts in Sub-Saharan Africa are now based, compared to just 8% five years ago.

Markets such as Gabon, Ghana, Kenya, Namibia, Tanzania, Uganda and Zimbabwe have more than 40% of users as active mobile money users.

Eoin Treacy's view

The transition of a mobile phone into a mobile wallet is a global phenomenon but is moving particularly swiftly in markets with less robust networks of retail banks or where there is a problem with counterfeit currency. While online payments are progressing swiftly in Europe and North America but the pace with which the technology is being picked up in Africa, India and China is startling.

What really rammed home this point for me this week was when we used a taxi, that I hailed down on the street rather than through the Didi ride hailing app. When Mrs. Treacy paid in cash rather than through Alipay she received three counterfeit 20-yuan notes in change. It was dark and it was only later she discovered the subterfuge. It was one of the few occasions any of us paid with cash on this trip and it is obviously a problem. Alipay has large billboards in the subway touting the benefits of its service for vendors so they can avoid counterfeit currencies. Right now, they are promoting their cashless week and almost every transaction entitles the consumer to a discount. Meanwhile a considerable number of ATMs are out of service not least because the transition to mobile money has been so widespread.

The upgrade of India’s mobile network from 2G to 4G late last year is likely to be an equally transformative event and the benefits of mobile money for both consumers and vendors will permeate the economy for years to come.  

Governments are also happy to witness this transition because there is a clearly defined paper trail which makes it easier to collect taxes and shrinks the size of the black market. Monetary purists will of course also be rightfully skeptical at handing governments such control over the monetary system because it will make it so much easier to affect the monetary base.