The Next Frontier of Mobile Money Adoption

Abstract

In this article, I explore the characteristics of businesses that use mobile money by using the World Bank’s Enterprise Surveys Program data set for the year 2013. I study firms in Kenya, Tanzania, Uganda, and Zambia. My analysis shows that small firms are more likely to use the service than medium and large firms. Also, older firms are more likely to use the service than younger ones. Moreover, firms with bank accounts are more likely to use the service. Finally, firms in Kenya are more likely to use the service than firms in Tanzania, Uganda, and Zambia.

KEYWORDS:

• firms
• Kenya
• mobile money
• service providers
• Tanzania
• Uganda
• Zambia

Notes

¹ M-PESA: M stands for mobile and PESA means money in Swahili, a local language in Kenya.

² N. Hughes and S. Lonie led a team at Vodafone that invented the concept of mobile money for the Kenyan market.

³ Mas and Mrawczynski (2009) and Hughes and Lonie (2009) offer a detailed description of the M-PESA service.

⁴ The World Bank defines a micro firm as one that has fewer than five employees, a small firm as one that has between five and 19 employees, a medium firm as one that has between 20 and 99 employees, and a large firm as one that has more than 99 employees.

⁵ For more detailed discussion of the data set, visit the web site enterprisesurveys.org.