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Implementation of Mobile Money in Ghana

Paper Type: Free Essay Subject: Finance
Wordcount: 3909 words Published: 29th Jul 2021

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As part of the broader strategy to create an enabling regulatory environment for convenient, efficient and safe retail payment and funds transfer mechanisms, Bank of Ghana issued the Branchless Banking Guidelines in 2008 and the Guidelines for E-Money Issuers (EMIs) and the Agent Guidelines in June 2015. The broad objective of these guidelines was to promote financial inclusion initiatives by extending financial services beyond the traditional branch-based channels and to limit e-money issuance to licensed Dedicated Electronic Money Issuer institutions. These guidelines formed a core part of the Bank’s strategy to create a supportive regulatory environment for adoption and use of a convenient, efficient and safe electronic retail payments and funds transfer.

The launch of Ghana’s first Mobile Money Interoperability Payment System in May 2018 is an important milestone towards an integrated and interoperable electronic payments environment and will have a major impact in efforts to ensure greater financial inclusion.

Following publication of the guidelines, there has been increased activity in electronic payments, especially mobile money, with tremendous positive impact on financial inclusion.

Objective of the term paper

The term paper sorts to study the Enablers and constraints associated with mobile money before and after of interoperability implementation in Ghanareference to;

  • Socioeconomic impact of interoperability and use at the consumer, agent, agent, provider, banks and national levels.
  • Offer recommendations for policy and practice


Global Economic Situation  in Mobile Money interoperability (Literature Review)

Mobile money interoperability in Ghana is at its infant stage. Some countries across the world however have created traces in this area which have become lessons for Ghana;

  • Bangladesh

The first mobile money service was launched in 2006, and uptake was still rather low in 2014. Bangladesh has a bank-based model, but interoperability is permitted. As quoted by Anderson et al. (2015), “Banks may link their mobile financial services with those of other banks for the convenience of the users”. Interconnection can happen through a third-party platform, bKash. This platform allows different mobile network operators to join a single network and use bKash for mobile money transactions (Lehman and Ledgerwood, 2013).

  • India

According to Mas (2011), the National Payments Corporation of India (NPCI) has created a micro-switch enabling mobile transactions between accounts of participating banks. If all the banks (and any licensed nonbank account issuers) join and set the interchange fee low enough, then any retailer could in principle declare itself a cash in/out point for any bank simply by virtue of having an account with one participating bank.

  • Indonesia

In May 2013, Telkomsel, Indosat, XL introduced A2A-Interoperability (GSMA 2013b, GSMA 2014, CGAP 2015), which as an agreement negotiated between the operators was a world-first. The choice fell on bilateral connections so that the scheme would not be dominated by any single operator. GSMA (2013 SOTIR, Text box 11) states that joint development was chosen for its simplicity, neutrality, and cost-efficiency, with deployment happening in just 6 months. Two of the operators developed their platforms in-house, and the third one purchased the core platform from an external mobile money software vendor (Camner, 2013a, 2013b).

  • Kenya

Mobile penetration is high in Kenya. According to figures from the Communications Authority of Kenya, there were 39.7 million subscribers in June 2016, which corresponds to a penetration of 90% of population (note however that the number of unique users is probably lower, because it is common to own more than one SIM card).

There are four leading mobile operators in Kenya. All the operators provide mobile money services to their consumers, under the brand names M-Pesa (Safaricom), Airtel Money (Airtel), Orange Money (Orange) and Equitel (Equitel). Currently, the Central Bank of Kenya seems to be pushing for interoperability, but Safaricom is resisting. An article from The Economist summarizes the situation as follows: “the government is a big shareholder in Safaricom, and the company also happens to be the country’s biggest taxpayer: last year it fed the government $400m in fees, taxes and dividends.

  • Madagascar

In Madagascar, the three mobile money operators — Airtel Money, mVola and Orange Money — are not yet interconnected. Evans and Pirchio (2015) mention Madagascar as a country where mobile money “failed to ignite”. On 13 September 2016 the GSMA announced that a national interoperable mobile money system will be launched (GSMA 2016Mad). While the announcement by GSMA is not clear, and no further information seems to be available on its actual form, it seems that this interoperability arrangement is based on collaboration between the three mobile money operators, i.e. it is similar in spirit to the arrangement in Tanzania

  • Mexico

In 2004, the central bank of Mexico (Banxico) created SPEI, Sistema de Pagos Electrónicos Interbancarios, a central switch for the commercial banking system. G20 (2010) reported that mandatory interconnection through the switch was imposed. One reason for the low penetration of bank accounts is that banks ask for high fees and minimum balances, and are not interested in the business with the low-income population. Evans and Pirchio (2015) conclude that in Mexico mobile money has failed to take off.

  • Nigeria

In 2009, Nigeria published the Mobile Money Regulatory Framework for Mobile Payments. This scheme is bank-based, and mobile network operators’ role is only to provide a platform for the use of banks. Agents can contract simultaneously with multiple banks (Anderson et al. 2015), thus agent interoperability is also part of the system. Nigeria mandated interoperability between mobile money operators in 2012, by February 28, 2013, via a National Central Switch (Central Bank of Nigeria 2012):

Interoperability in Ghana (Process flow)

The mobile money interoperability system was to allow the easy transfer of money across all mobile money platforms, without restrictions and facilitate the transfers of monies between bank accounts and mobile money platforms. The move by the government to introduce this system is to move Ghana towards a cashless society, as well as boost financial inclusion and increase investments into our country.

In making a cashless society, this system has made it possible for people to send and receive monies from far instance, sending money across various mobile money networks without restrictions.

Gone are the days when one would have to withdraw physical cash from a mobile money account, in order to be able to send the same money to a receiver on a different mobile money network. This move by the government has, as a result, made online payments much easier, since differences in mobile money services is no longer a barrier to making payments.

Businesses will hence improve as a result of the easy movement of monies, which will, in turn, save more time for production, ensure easy money transfers and create easy access to financial institutions without moving from one’s comfort zone.

Transactional Volumes after the interoperability in Ghana

Some 96,904 cross-network mobile money transactions took place in the first month of the launch of mobile money interoperability. The transactions are valued at over ¢8.3 million. These transactions are limited to transfers from mobile money wallet to another, according to a report on the first-month performance of the mobile money interoperability, launched on May 10, this year.The report sourced from the Ghana Interbank Payment and Settlement System (GhIPSS), also indicates that close to 40, 000 transfers were made from mobile money wallet to bank accounts valued at almost ¢4.2 million. This brings the total volume of transactions, comprising mobile money wallet to another wallet as well as mobile money wallet to a bank account, to over 136,000, valued at about ¢12.5 million. The launch of mobile money interoperability made a seamless transfer of funds from one mobile network to another possible. It also becomes possible for people to transfer funds from their mobile money wallet into their bank account without physically going to a banking hall or using the platform of a Fintech. Mobile money interoperability is a major breakthrough, which is expected to deepen financial inclusion in Ghana. On the very first day, it commenced, about 3, 000 transactions, were made. However, at the end of its first week, a total of 28,000 transfers valued at about ¢2.3 million were made. In the second week, the total volume went up by about 30 per cent to 36,181 transfers valued at about ¢3.3 million, representing an increase of over 44 per cent in terms of value. This makes the first-month transaction volume of almost 97,000, a significant leap in the volume of transactions, pointing to a growing use of the cross-network transfers

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Socioeconomic Impact of the Interoperability of mobile money in Ghana

The analyses on socioeconomic impact of Mobile money interoperability Policy in this paper have been grouped into four. These groups include the impact on the consumer (section 5.1), the impact on the Agent (section 5.2), the bank (section 5.3), the provider (section 5.4) and the nation(section 5.5). For each of the four, the enablers and constraints for both before and after implementation of the mobile money interoperability have been given. Policy implications of the implementation have been clearly analysed below.

Impact on the Consumer

The consumer in this case is the one who is the final user of the service, he is however charged on the services rendered to him. The consumer may have cash in the bank and may wish to transfer such funds onto his mobile money wallet or vice versa. These transfers are usually done with the support of a mobile phone which has a telecommunication network like MTN, TIGO-AIRTEL, GLO and VODAFONE. The bank here becomes the intermediary. Also if the services of such are available, he may also want to transfer cash from his mobile wallet onto a different Mobile network ( eg. He may transfer money form MTN Mobile money to VODAFONE mobile money).  It is imperative to state that the introduction of mobile money interoperability has significant economic impact. The socioeconomic experience of the consumer before and after the Mobile money interoperability is however stated below.

Table 5.1:  Impact of Mobile money interoperability on the Consumer





  • Before the interoperability, there was less mobile money fraud.
  • Agents could count more transactions. This was because, mobile money transaction definitely involved the agent and they made income
  • Convenience of doing money transfer transaction
  • Easy access to bank accounts and mobile money accounts for transactions
  • Saves cost of transportation ( ie. Withdrawing from the bank and transferring onto mobile money  with the mobile money agent)


  • Before the interoperability, a  person will have to do manual withdrawal from his bank before he can then go to a mobile agent to transfer onto the mobile wallet
  • After the implementation , Consumers have realized Multiple charges from the network(Telecommunication) providers and the banks
  • Possibility of accounts manipulations by unauthorized users


Impact on the Agent

The Agent here is usually referred to as the merchant. He loads enough electronic funds (E-CASH) onto his merchant wallet. He accepts cash from clients (consumers) and deposit onto their (customers) mobile money wallet. The Agents (Merchants) receive commissions as they transfer the e-cash. The interoperability has impacted significantly on the operations of the Agents. The socioeconomic impact (enablers and constraints) have been given below in Table 5.2;

Impact of Mobile money interoperability on the Agent





  • The Agents Received income (commission) on the many transactions. They received income even from those who were not transferring from bank to wallet directly
  • Convenience of doing money transfer transaction
  • Possibility of combining other businesses as consumer patronage will be low on direct mobile money transfers


  • Agents could not load e-cash onto their merchant wallets directly from their bank accounts.
  • Agents may lose income of customers (consumers) who do their own mobile transaction from their bank account to their mobile money wallet without Agent involvement.



Impact on the Bank

The bank, before the implementation of the interoperability only loaded funds (E-cash) onto the wallet of the Agents (merchants). The bank also loaded e-cash for walk-in customers. However, the bank did not do cash out (withdraws) for both individuals and the Agents. The restriction of the banks was necessary. It ensured that the operations of the Agents were not affected negatively. If the banks did cash out,  it means that they would be competing with the merchants, eventually the merchants could collapsed since they (merchants) did not have sustaining resources and business strategies like the banks. The introduction of mobile money interoperability has changed the story. Banks can now facilitate transfer of cash from a customer’s account onto mobile money wallet. The new development has brought socioeconomic impact on the bank and it’s summarized below in Table 5.3.

Impact of Mobile money interoperability on the  Bank





  • There was less competition
  • The bank will get Income(from charges) if a consumer transfers cash from bank account to the mobile money wallet
  • The banks gets wider market segment because more consumers (or account holders) will want to transfers money from their bank account to their mobile money wallet.


  • Banks could not load e-cash from merchants bank account to their wallets
  • There could be more of fraudulent transactions since Proper KYC may not be established. This is because mobile money transactions are seen by many consumers as minor transaction  and does not need strict consumer personal details. This gives way for many fraudulent mobile money fruads.


Impact on the Network Provider

The network provider here could be MTN, TIGO-AIRTEL, GLO or VODAFONE. The network provider ensures that there is inter connectivity amongst callers or data users. Mobile money services are directly facilitated by the network providers. In this case, the consumers (companies, Agents and individuals) register their mobile money SIM. The registration is a requirement which identifiers members, so that they can do e-cash transactions. The network providers do not have anything to do with physical cash during the loading processes. They only facilitate with system on the e-cash movements. The implementation of the Mobile Money interoperability has introduced some socioeconomic impacts on the side of the mobile money network providers. The enablers and constraints before and after implementation on the part of the network provider have been showed in table 5.4 below.

Impact of Mobile money interoperability on the  Network provider





  • There was an increasing customer base, but at slower rate
  • The customer base is increasing at a very high rate with the implementation.  Many clients ( banks, companies, Agents, individuals have subscribed). Customer market share has increased.
  • Revenue has increased


  • There were some reported cases of fraud incidences
  • Reported cases of mobile money fraud is high
  • When some gets access to the mobile money  passwords he can easily transfer unauthorized cash to his wallet.




Impact on the Nation

The interoperability of mobile money services has impacted positively on Ghana, more especially in the area of tax generation.

Impact of Mobile money interoperability on the Nation





  • Saves time and convenient
  • There is Increase in Ghana’s GDP. There is increase in income in the banking sector. The banking sector is a key part of GDP contribution. This means that mobile money transactions will Aggregately add to Ghana’s GDP as there many subscribers now
  • Common platform for investment
  • Reduced the carrying of hard currency.



  • Non acceptance of the interoperability by mobile money Agents. They thought the banks will take over their market share of the mobile money busisness.
  • Cases of high level fraud which may not attract investors
  • Poor penetration. Industry players thought the idea was because of government tax agenda. Other players have not opened up fully yet.




  • The interoperability of mobile money in Ghana has seen some developmental constraints. For example, there has been issue of low response by industry players( ie. Mobile money Agents). The Agents feel like they are being wiped out of business. This is because, before, customers came to do their transfers.
  • Now those clients are able to move money cash from their bank accounts onto their wallet, without the involvement of the Agent (Merchant).Also there has been multiple charges compared to before when there was only single charge on transactions. Currently, bank collects fees, the network providers also collect fees on the same transactions
  • Despite the constraints, mobile money interoperability has contributed a lot, to the consumer convenience, to the bank , it has increased in operational coverage, to the network provider, it has increased in customer base. The aggregate contribution of the implementation is that it has contributed greatly to the Gross Domestic Product (GDP) of Ghana.
  • The implementation has also served as the pivoting point for Ghana’s cashless economy agenda.


  • The government (National Communication authority-NCA) should regulate the telecommunication companies to charge fees that are affordable to the mobile money subscribers.
  • Industry players (Banks, Agents and individuals) should be abreast with the dynamics of mobile money fraud. For example Bank should strictly comply with the new policy on cyber security. The banks should engage cyber security officers who will monitor and prevent incidences of fraud.
  • Proper KYC(Know your customer) document should be kept by stakeholders  to enable fraud cases by investigated easily.
  • There should be enough education to create awareness on the importance of the mobile money interoperability


  • https://www.bog.gov.gh/privatecontent/Public_Notices
  • Anderson, Leigh et al. 2015, Review of Interoperability and Regulations of Mobile Money, Evans School Policy Analysis and Research (EPAR) Technical Report 313,
  • Camner, Gunnar (2012), “Expanding the Ecosystem of Mobile Money: Considerations for  Interoperability,” GSMA Mobile Money for the Unbanked position paper, London, UK, GSMA 2013b, Mobile Money for the Unbanked Case Studies: Insights, best practices and lessons from across the globe
  • Mas  Ignacio (2011) Enabling different paths to the development of Mobile Money, chapter 4 in GSMA — Mobile Money for the Unbanked,
  • Reserve Bank of India, 2016 July 1, Master Circular – Mobile Banking transactions in India – Operative Guidelines for Banks,


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