The three-pronged approach to mobile money operations – encompassing telcos, fintechs and bank – is responsible for its rapid and widespread adoption, innovation and overall financial inclusion.

This is according to Archie Hesse – Chief Executive Officer-Ghana Interbank Payment and Settlement System (GhIPSS) – who says the development has allowed the different actors to mutually complement one another, driving significant progress in the sector.

“Worldwide, most mobile money services are offered by telcos; in Ghana, we have three sectors – the fintechs, banks as well as telcos offering the service,” he said on the sidelines of an interaction on features of the bank-led GhanaPay platform.

“What we have is very healthy in the sense that it is not one entity providing the majority of services, we have a very heterogeneous set-up,” he added.

Despite previous modest attempts, the issuance Electronic Money Issuers Guidelines (EMIG) and Agent Guidelines (AG) in 2015 – which allowed non-bank entities like telecommunication companies to establish subsidiaries licensed by the Bank of Ghana (BoG) to issue electronic money – marked a watershed moment for mobile money adoption in the country.

This policy change spurred massive investments in the ecosystem by telecommunication companies. Consequently, total volume of transactions rose from 3.78 million and 18.0 million in 2012 to 7.17 million and 113.18 million in 2014 respectively.

Less than a decade later, at the end of 2023, the total value of mobile money transactions in the country reached an all-time-high of GH¢1.912trillion in 2023 compared with GH¢1.07trillion in 2022, according to central bank data.

In the first two months of 2024, the total value of mobile money transactions reached GH¢394.2billion – a 49.3 percent increase over the figure in last year’s corresponding period .

The GhIPSS CEO expressed conviction that improved standardisation, particularly with QR codes, will drive the numbers further and accelerate the cash-lite agenda.

GhanaPay

Since its inception in 2022, Mr. Hesse added, GhanaPay has become a vital tool for repetitive transactions, catering to the needs of bank account holders who also require mobile money wallets.

Explaining the rationale behind GhanaPay, he said: “The mobile money services by itself was to address the unbanked situation that we have in the country. From inception it’s the telcos that have been leading it, and then the fintechs also got involved. Now, the banks are also saying that the mobile money platform has become a very convenient tool”.

By sharing a unified platform, the country’s 23 banks have avoided prohibitive costs of individually acquiring mobile money platforms.

“It would have been very expensive. So the banks came together and bought one platform that they can share,” the GhIPSS CEO noted.

This shared approach not only reduces costs but also ensures a cohesive service across the banking sector.

GhanaPay maintains each bank’s identity within the shared platform. When customers use their GhanaPay wallets, they see their bank’s name, personal details and phone number, fostering personalised service, he explained further.

This integration extends to management of the float, or money held within the mobile money wallet, which remains part of the customer’s bank account.

The platform’s introduction has also intensified competition within the market, Mr. Hesse said, providing consumers with more options and potentially lowering transaction costs. “Once you have more options, there will be healthy competition within the market. And together, the cost of transactions will go down,” he noted.

The platform currently offers free cash withdrawals at all bank branches and charges 50 percent less for cash withdrawals at all GhanaPay agent points. Quarterly statutory interest ranges between 1.5 and 2.5 percent.

Additionally, the platform is enhancing its features to include crowdfunding, sponsored accounts and improved security measures. The introduction of embedded insurance services and loan offerings, initially targeting small businesses, is planned.

Furthermore, there will be wider integration to facilitate cross-border trade.