Mobile Financial Services in Emerging Countries: Technology, Adoption, and Regulatory Issues

Abstract

This chapter describes a recent World Bank report which indicated a sizable percentage of households in developing countries do not have access to formal accounts with financial institutions. The situation has created a major barrier in the quest for a world without poverty due to the exclusion of segments of society from the formal financial system. The phenomenon has resulted in the exclusion of many from traditional financial services, thus the use of other means to conduct informal financial transactions. In Ghana, many households rely on domestic informal forms of remittance to relatives and payments. Such informal mediums of remitting money to and from relatives in Ghana (e.g. via “Bus Driver”) received wide patronage irrespective of the associated risks until mobile financial services were introduced. This chapter discussed Mobile Financial Services (MFS) from the perspective of emerging economy and treats the following topics; technology, adoption and the regulatory issues in MFS.