Mobile money as a frugal innovation for the bottom of the pyramid – Cases of selected African countries

ABSTRACT

This paper explores the concept of mobile money as a frugal innovation and a business model. While the frugal innovation theory is evolving, frugality addresses three critical issues about social problems, resources constraints and institutional voids. This paper argues that mobile money as a frugal innovation lies at the intersection of social innovation, technological innovation, and institutional innovation. The paper adopted a case study approach allowing for quantitative and qualitative analysis and interpretation of data to explore mobile money adoptions in selected African countries. We drew the study sample purposefully from countries that have witnessed significant adoption of mobile money services. We went on to layer data representing the cost of financial services, distribution or financial services points and financial inclusion rates from the select sub-Saharan African countries on the literature evidence, we interrogate the extent to which mobile money is both a frugal innovation and business model. This paper concludes that mobile money as a frugal innovation addresses affordability constraints and resource constraints, and reduces institutional voids in resource-constrained environments.

KEYWORDS:

• Frugal innovation
• mobile money
• resource constraints

Disclosure Statement

No potential conflict of interest was reported by the authors.

Notes on contributors

Olayinka David-West is a Professor of Information Systems as well as the Academic Director and Project Director of the Sustainable and Inclusive Digital Financial Services initiative in Lagos Business School, Pan-Atlantic University, Lagos, Nigeria. She holds a Doctorate in Business Administration from Manchester Business School. (Email: [email protected])

Nkemdilim Iheanachor is a Lecturer in Strategy and International Business as well as Researcher in the Sustainable and Inclusive Digital Financial Services initiative in Lagos Business School, Pan-Atlantic University, Lagos, Nigeria. He is a PhD candidate in International Business in Pan-Atlantic University, Lagos, Nigeria. (Email: [email protected])

Immanuel Ovemeso Umukoro is a Researcher in the Sustainable and Inclusive Digital Financial Services initiative at the Lagos Business School, Pan-Atlantic University, Lagos, Nigeria. He is a PhD candidate in Information Systems at the Africa Regional Centre for Information Science (ARCIS), University of Ibadan, Oyo State, Nigeria. (Email: [email protected])

ORCID

Olayinka David-West http://orcid.org/0000-0002-5545-7230

Nkemdilim Iheanachor http://orcid.org/0000-0003-1139-9355

Immanuel Ovemeso Umukoro http://orcid.org/0000-0002-2054-5070

Notes

1. How West Africa is dominating Global Mobile Money Int'l Remittances.