Financial Inclusion: What's Next?

A woman selling roasted plantain and groundnuts by the roadside is approached by a customer, looking for a quick meal to quench the hunger of the day. The customer places an order and, after hearing the price, reaches for their phone to pay with MoMo. "Ei no oh, I don't take MoMo, only cash", the seller exclaims. The customer looks at the woman in surprise then, after digging into the depths of their bag, manages to pull out a note that barely covers the cost of the meal. "Madam, these days you need to have MoMo oh", the customer warns as she leaves with her meal.

A story like this could have easily happened about 15 years ago, when MoMo was new in Ghana and had not yet been widely adopted. Today, the customer's surprise is becoming increasingly legitimate. Mobile money transactions have become the norm in Ghana and across Africa. It is no longer necessary to have a bank account or internet access to make electronic transactions. With a basic phone and USSD, anyone can send money and pay a bill to anyone, anywhere in the country, via mobile money.

Since the emergence of technologies like mobile money, financial inclusion has rapidly expanded and reached previously unbanked populations, while economic transaction volumes have grown exponentially. But now that everyone has MoMo, what's next? Has true financial inclusion been achieved?

Matilda Asante-Asiedu, Second Deputy Governor of the Bank of Ghana, stated at the recent 3i Africa Summit in Accra that the country had made progress in financial inclusion but needed to broaden its investments in the "architecture" to further close gaps and attract capital. The conversation around financial inclusion is therefore evolving from simply counting mobile money wallet holders to something deeper.

To understand what comes next, we need to look at the metrics of success, both globally and locally.

For years, access has been the standard for measuring financial inclusion — opening a bank or mobile money account. Yet tracking only this metric can mask more relevant information, such as the actual activity of these accounts and how they are used. After all, an account can be opened and used only once a quarter, while still being counted as a statistic supporting financial inclusion growth and activity.

In response to these types of concerns, the Ministry of Finance adopted a multidimensional framework for measuring financial inclusion holistically. This framework evaluates three dimensions:

Access - The physical and digital proximity of financial institutions, ATMs, and mobile money agents.

Usage - The regularity, depth, and diversity of financial product consumption over time (e.g., formal savings, credit, and insurance).

Quality - The relevance, simplicity, and safety of financial products, alongside robust consumer protection and financial capability.

With these metrics in mind, let's consider our position more critically now. Active MoMo accounts in Ghana stand at 112.55% (Ministry of Finance Financial Inclusion Report, 2023). But what picture does this paint? A consumer might use MoMo daily for transfers to friends or family, or casual payments, but true economic empowerment relies on systems like formal savings, credit networks, and safety nets.

Looking at the state of existing financial security products raises some eyebrows. For pensions products, only 37.47% of the adult population is registered with formal pension schemes.

Total insurance coverage sits at 40.9% of the adult population, with the industry premium contributing less than 1% (0.94%) to the national GDP.

For the roadside plantain seller, having a MoMo wallet is a vital tool she needs to transact with her customers, but without a path to formal micro-credit, business insurance, or a pension, she is vulnerable to economic shocks, which true financial inclusion seeks to prevent.

To answer the question of what's next, policymakers and the private sector must pivot from expanding reach and access to improving the quality of what products the population has access to. We need to move beyond basic transfers to insurance and credit scoring tools. Some work has already begun, with the introduction of products like Y'ello Save and MyOwnPension on MoMo, but these are basic tools that can be leveraged to do more.

There also needs to be consistent educational campaigns to equip the population with the capability to manage their digital wealth safely, what with threats of fraud and data privacy violations growing alongside financial inclusion initiatives.

The transition from a purely cash economy to an unbanked population empowered by mobile wallets was Ghana's first digital and financial revolution. The next steps demand that we turn these systems into pathways for wealth creation and equitable empowerment, which will result in long-term economic resilience. We must change the perspective through which we see financial inclusion, not just as a mere statistical milestone, but as a critical foundation for national prosperity.