2016

The State of

Mobile Money in

Sub-Saharan Africa

Over the last decade, global mobile money adoption has been driven

by growth in Sub-Saharan Africa

2

Deployments Countries

Sub-Saharan Africa

Global

39

92

2

5

20162006

Sub-Saharan Africa

Global

140

277

2

20162006

7

With more money mobile accounts than traditional bank accounts,

financial inclusion has significantly improved in Sub-Saharan Africa

0

50

100

150

200

250

300

Dec

2011

Dec

2010

Dec

2008

Dec

2009

Dec

2007

Dec

2012

Dec

2014

Dec

2013

Dec

2016

Dec

2015

Millions

*Source: AFDB, The Banking System in Africa: Main Facts and Challenges. SSA bank accounts per 1,000 adults: 334.5

277M

0.2M

Number of bank

accounts in 2015 178M*

Growth of registered mobile money accounts in Sub-Saharan Africa, 2006 to 2016

XM Number of mobile money accounts

3

Mobile money account adoption in Sub-Saharan Africa has outpaced

growth in the rest of the world

0

10

20

30

40

50

60

70

80

90

100

110

2011 2012 2013 2014 2015 2016

Rest of the world

Sub-Saharan Africa*

90-day active

accounts,

millions

Growth of 90-day active mobile money accounts, 2011 to 2016

*Sub-Saharan Africa comprises: East Africa, Central Africa, Southern Africa, West Africa

Note: Rest of the world excludes Sub-Saharan Africa4

More than 40% of the adult population is using mobile money on an

active basis in seven Sub-Saharan African countries

Gabon

Ghana

Kenya

Namibia

Tanzania

Uganda

Zimbabwe

5

Regionally, mobile money adoption is being driven by growth in

West Africa

2011

2016

Growth and share of 90-day active accounts Share of value of transactions

92%

71%

8%

29%

18 mn

100 mn

West Africa Rest of Africa

6

98%

87% 14%

2%USD

13 mn

USD

66 mn

Sub-Saharan Africa has a smaller gender gap to bridge than other

emerging regions

*Source: GSMA Connected Women – Mapping the mobile money gender gap: Insights from Cote d’Ivoire and Mali, April 2017

Sub-Saharan

Africa

19.5% 225M

Total low- and middle-income

countries

36% 1.9B

Mobile money gender gap = (% of men +15 with a mobile account - % of women +15 with a mobile

account) / % of men +15 with a mobile account

Mobile money gender gap

Number of women without

a mobile money account

Middle East

81% 48.5M

South Asia

66.6% 555M

East Asia &

Pacific

29% 775M

Latin America

& Caribbean

41% 204M

7

Values, 2016 Volume, 2016

Volume, 2011Values, 2011

Transactions have diversified from airtime top-ups and P2P

transfers to more sophisticated use cases…

Sub-Saharan Africa

Product Mix

2011 to 2016

Ecosystem:

11%Ecosystem:

4%

Ecosystem:

24%Ecosystem:

17%

3.0% 3.9% 4.9%0.2%

2.1%

86.0%

64.3%

1.5%

1.0%

0.0%

0.9%

32.3%

6.1%11.0%

4.3%1.3%

7.0%

70.4%58.9%

11.8%

1.9%

0.2%

2.8%

24.4%

Ecosystem

transactions

Airtime top-up

Bill payment

Bulk disbursement

International remittance

Merchant payment

P2P transfer

Key

8

…which have been driven by a significant rise in bill payments

Ecosystem transaction volumes, 2011 to 2016

0

100

200

300

400

500

600

700

800

900

1,000

1,100

2011 2012 2013 2014 2015 2016

Millions

0 200 400 600 800 1,000 1,200

2014

2015

2016

International RemittanceBill payment

Bulk disbursement Merchant payment

Volume, Millions

Ecosystem payments almost quadrupled

between 2014 and 2016, driven by bill payments

96%CAGR, 2011 to 2016

9Note: CAGR stands for Compound Annual Growth Rate.

CAGR represents the mean rate of growth between two time periods, assuming that growth has been compounding over that time period.

Incoming transactions show a prevailing reliance on agents, while

cash digitisation has increased

92.7%

81.7% 13.3%

6.3%

0.7%

0.7% 0.3%

100%

4.4%

International Remittances

Bulk disbursements

Bank-to-Wallet transcations

Cash-in transactions

Incoming

transactions

US$ 2.9 billion2013

2016Incoming

transactions

US$ 5.8 billion

Evolution of incoming transactions in Sub-Saharan Africa, 2013 vs 2016

10

As revenue continues to rise, agent commission distribution allows

for greater employment and income generation for SMEs

Source: GSMA SOTIR 2016 Data

Leading mobile money operators

in Sub-Saharan Africa paid out

47% of their revenues as commission.

This amounted to over US$ 400

million in 2016

Between September 2015 and June

2016, mobile money revenue in

Sub-Saharan Africa grew by

27%

11

A ten-fold increase in agent reach over five years may have driven

mobile money growth in Sub-Saharan Africa…

Note that this is not the number of unique mobile money agent outlets, but rather the sum of the agent outlets providing cash-in and cash-out services for the mobile money services that are available globally. In many

markets, individual outlets may serve several mobile money service providers. This practice is more pronounced in mature mobile money markets, particularly where competition among service providers is high. For that

reason, the number must be interpreted with care, as it does not reflect the number of unique mobile money agent outlets. Agent outlets and registered agents are used interchangeably.

12

Active agents in Sub-Saharan Africa

2016 ~1.5 million1.75

Agents per

1,000 adults

2011 ~100,0000.18

…with an increasing number of enabling markets also allowing for a

rise in mobile money use

Note: the methodology that determines whether a country has enabling or non-enabling regulation is due to change, which will impact the figures shown above.

Regulation in Sudan is currently under development.13

Rest of the world Rest of the world18 24

June 2013

24countries with enabling

regulation in Sub-

Saharan Africa

April 2017

30countries with enabling

regulation in Sub-

Saharan Africa

14

18

10 Countries

60

17 Countries

Mobile money-enabled

insurance services in

Ten million policies

issued by June 2016

Mobile-enabled insurance and savings services have seen growth

across the region…

Mobile money-enabled

savings services in

Note: the methodology that determines whether a country has enabling or non-enabling regulation is due to change, which will impact the figures shown above.

Regulation in Sudan is currently under development.

As at June 2016 As at June 2016

…while mobile credit services have made great strides in mature

mobile money markets, particularly in Kenya and Tanzania

*Source: Daily Monitor Uganda 16 August 2016 - Groundbreaking: When the mobile phone became a bank

M-Shwari 2014 NPL ratio: 5.6%; Kenya 2014 NPL ratio: 10.5%15

2012 2014

Number of

accounts~15 million ~5 million

Value of loans

disbursed

US$ 1.3

billion

US$ 22

million

Non-performing

loan ratio

M-Shwari

Kenya*

M-Pawa

Tanzania*

Established

1.92%(Kenya: 5.3%)

8.52%(Tanzania: 8.3%)

Mobile credit services in sub-Saharan Africa

11

countries

Cameroon

Ghana

Kenya

Malawi

Nigeria

Rwanda

Senegal

Tanzania

Uganda

Zambia

Zimbabwe

2016

39

services

1

country

Kenya

2011

6

services

*As at June 2016

Mobile money use has generated positive externalities for other

industries, especially in providing services for rural communities

TZS 1 billion per month*

additional revenue collected via mobile money

by the Dar es Salaam Water and Sewerage

Corporation in 2013, increasing revenue by 38%

99.3%

the proportion of 1.7 m secondary school

students who paid their annual school

registration fee via mobile money in 2015-2016

Over 500,000**

the number of household solar power kits sold

by M-KOPA in Kenya, Uganda and Tanzania by

April 2017

35,000^

the number of farmers in Kenya and Tanzania

who were receiving support through Vodafone’s

Connected Farmer Alliance as of October 2014

Water and sanitation | Tanzania Education | Côte d’Ivoire

Energy | East Africa Agriculture | East Africa

*Source: The Citizen - Dawasco hails M-Pesa billing, 10 July 2013

**Source: M-KOPA Solar Press Release: M-KOPA Connects Half a Million Homes, 27 April 2017

^Technoserve – Connected Farmer Alliance

16

Opportunities remain for mobile money growth across Sub-Saharan

Africa, based on total customer base per deployment

90-day activity rate on GSM customer base per mobile money deployment in

Sub-Saharan Africa, June 2016

Note: This graph shows mobile money deployments in Sub-Saharan Africa with activity rates >2%

Calculation: active 90-day mobile money customers / mobile connections (unique subscriber) for every operator

0%

10%

20%

30%

40%

50%

60%

70%

80%

Mobile money deployments

90-day

activity rate

118 millionthe number of 90-day accounts

mobile money services could gain if

they achieve activity rates of 40%

17

Deployments with

a high activity rate

Deployments with

a low activity rate

INVESTMENT

In addition to high operational expenditure

and full buy-in from senior leaders, constant

investment is necessary to ensure growth

INFRASTRUCTURE & TECHNOLOGY

Harmonised APIs can improve seamless

integrations, stimulating new and complex

use-cases and products for users

POLICY & REGULATION

Maintaining a proportional risk-based

approach to regulation to ensure the service

can continue to reach low-income individuals

GENDER

Sub-Saharan Africa has a smaller gender

gap than other regions, but ~225 million

women still lack a mobile money account

RURAL

Only 17% of the addressable market has

been captured in rural markets, remaining a

source of untapped potential for providers

ECOSYSTEM DEVELOPMENT

Interoperability at the regional level would

enable a rise in ecosystem transactions,

such as cross-border remittance payments

As mobile money adoption and use continues to rise, future growth

can be unlocked by addressing a number of key drivers

18