Mobile Phone-Based Money as a Tool for Financial Inclusion in Developing Countries : A Review

As new technologies and business models evolve, they have a growing impact on economies and societies worldwide. Digital transformation has enabled countries to foster inclusive and sustainable development, particularly in traditionally disadvantaged areas. The digital age has advanced mobile technology that has improved global communication accuracy, economic activity, social inclusion, and productivity in industries such as agriculture, health, education, and finance. However, although telephone penetration is increasing in developing countries, their use for financial services provision is still at an early stage and mostly associated with traditional banking. Due to this, bridging the financial inclusion gap between urban and rural poor has remained a challenge. While there are some developing countries that have embraced mobile phone-based money also known as ‘Mobile Money’ to serve low-income, unbanked populations, it is still unclear what characteristics, preferences, and needs could motivate its ignition other developing countries. Through an in-depth review of literature on financial inclusion and technology usage, this paper is primarily focused on bringing mobile money (MM) best practices that can be used to enhance financial inclusion in developing countries. Results indicate that individual’s perception of technology including perceived usefulness, perceived ease of use, trust and perceived risks, followed by social and organizational factors are core for the use of MM to enhance financial inclusion