Ghana’s efforts to promote financial inclusion through mobile money is marred by rising dormant or inactive accounts. Although registered accounts continue to record a steady increase, a significant fraction of these accounts are not in operation.
According to the latest Summary of the Economic and Financial Data published by the Bank of Ghana, while current registered accounts significantly surged to 70.5 million as of August 2024, only 22.8 million are in active usage.
This put the dormant or inactive accounts at a whopping 47.7 million representing close to 70% of all total registered momo accounts.
On a year-on-year basis, between August 2023 and August 2024, registered mobile money accounts increased by 8.2 million, rising from 62.3 million to 70.5 million. Yet, the number of active accounts grew by a mere 1.2 million, from 21.6 million to 22.8 million over the same period.
The mobile money industry has become an avenue for expanding financial inclusion and banking services to the unbanked. But this paramount aim of mobile money is currently threatened by the growing gap between registered accounts and active accounts.
The Bank of Ghana defines active mobile money accounts as the number of accounts which transacted at least once in the 90 days before reporting. This means that over 47 million Momo accounts have not transacted any business in the last 90 days hence declared dormant/inactive.
This trend can be partly attributed to the current economic climate in Ghana, characterized by rising inflation, increased cost of living, and limited disposable income which may be hindering regular usage of mobile money.
As citizens struggle to meet basic needs, their ability to actively use mobile money for transactions and savings decreases, leading to account dormancy.
The current situation, while undermining financial inclusion, also signifies a lost economic opportunity. Mobile money platforms are not just for transferring funds but are critical for payments, savings, loans, and remittances. The more accounts remain inactive, the fewer people participate in this growing digital economy, potentially slowing down the digital transformation of Ghana’s financial system.
In addition, the government misses out in terms of revenues from mobile money users and service providers. As user engagement dwindles, the fees collected on transfers, payments, and other financial services drops, impacting the profitability and sustainability of the platform.
