The Growth of Digital Payments in Ghana (II)


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The Growth of Digital Payments in Ghana (II)

digital , 05-11-2019

Last week we touched on the impact and visible growth of Digital Payments in Ghana. Today we present, the second and final part of the article.

Digital payments have revolutionalised businesses, making the payment of goods and services more convenient and cheaper. Already, traditional banks and financial services companies are plugging into the digital ecosystem. Just last year, the Bank of Ghana approved 27 products and services for 16 financial institutions: in-bound remittance, agency banking, mobile money, card issuance, mobile banking, and mobile money pension services. These are clear signposts along the way to a cash-lite society. 

In a decade, Mobile Money has grown from zero to over 13 million active accounts, as at the end of 2018. Such progress is easing the pressure on cash printing, usage, counterfeit-proofing among others. Last year, the cost of running Ghana’s cash infrastructure was over GHS 153 million.

Businesses are swamped by the complexity of enabling multiple digital payment services. In some cases, there’s a transaction tree: consumers have to ping-pong money from one account to the other until it gets to the recipient’s account. Fintechs are driving innovations in the payments industry by removing barriers to digital payments. There are tested-solutions that coordinate the independent channels together into a seamless network; complete with an audit trail, receipting, e-commerce functionality, potential integration with the business accounting system and related support. The innovation is widening the customer base of businesses and spurring higher transactions; partly because digital payments nudge customers into making instant payments – a clear upside for the business. 

On the other hand, businesses have an easy opportunity to pay bills, distribute wages and salaries. Overall, one thing is clear: digital payments are on a course to crowd out cash; the question is whether businesses will ride the wave or will be swamped by it?