Africa is leading the way when it comes to mobile money systems with 51 systems in place in the continent, according to the United Nations.
The United Nations Conference on Trade and Development (UNCTAD) says as many as 37 of the deployments are in the least developed countries (LDCs).
A report entitled “Information Economy Report 2011: ICT as an Enabler for Private Sector Development stated: “Mobile money deployments have taken off in the past two years. According to data from the GSM Association, some 109 such deployments had been implemented as of April 2011, spanning all developing regions. Only 11 of these are in developed countries.”
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UNCTAD added that mobile money is providing better access to finance for small medium enterprises (SMEs) which are usually poorly served by banks and lending institutions in low-income countries.
“Banking through mobile phones allows for real-time transfer and the receipt of small amounts of funds at low cost. They can reduce the costs of processing and administering small loans, thereby alleviating a significant disincentive for lenders to extend credit to SMEs,” it said.
The report also stated that existing mobile money systems can become even better if adapted to meet the needs of small businesses.
“Basic money transfer or payment functions can have a major impact on the way small enterprises operate – they can enable them to better manage their cash flow and expedite the delivery of supplies and goods.”
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