Amid the exponential growth in the country’s mobile money sector, banking and financial consultant Dr. Richmond Atuahene has identified regulatory arbitrage as one of the biggest weaknesses in Ghana’s momo regulatory framework.
Dr. Atuahene warns that the country’s booming digital payments ecosystem has outgrown the rules governing it and could pose risks to financial stability if regulatory gaps are not addressed.
In his latest analysis of Ghana’s mobile money ecosystem, Dr. Atuahene argues that while mobile money has become one of the country’s greatest financial inclusion success stories, the different regulatory treatment given to banks and mobile money operators has created loopholes that could expose consumers and the broader financial system to significant risks.
According to him, the challenge lies in the fact that traditional banks operate under stringent prudential regulations, including strict capital requirements, liquidity standards, licensing conditions and intensive supervision, whereas mobile money operators are largely regulated as payment service providers under comparatively lighter regulatory requirements.
This disparity, he observed, has created what financial regulators describe as regulatory arbitrage, a situation where businesses structure their operations to benefit from less demanding regulatory requirements while offering services that increasingly resemble those of banks.
Regulatory Arbitrage: Different Rules for Similar Financial Services
Dr. Atuahene explains that Ghana’s mandatory bank-led partnership model has inadvertently deepened the problem. Under the arrangement, mobile network operators partner licensed banks to provide mobile money services. While the partner bank legally holds customer funds and the regulatory licence, the mobile network operator controls the brand, customer relationships and extensive agent network.
The result, he says, is a layered structure where different parts of essentially the same financial service fall under different regulators and legal frameworks. According to him, this blurs accountability, creates overlapping regulatory responsibilities, and allows institutions to benefit from each other’s regulatory perimeter.
Although the model has accelerated financial inclusion by bringing millions of previously unbanked Ghanaians into the formal financial system, particularly women and rural residents, it has also created consumer protection gaps and heightened concerns over systemic stability.
Beyond the regulatory arbitrage challenge, Dr. Atuahene identifies several other regulatory challenges confronting Ghana’s rapidly expanding mobile money industry.
Balancing Financial Inclusion with Stronger KYC Rules
One of the biggest dilemmas for regulators, he says, is balancing financial inclusion with anti-money laundering safeguards. Strict Know Your Customer (KYC) requirements help prevent financial crimes, but obtaining mandatory identification documents such as the Ghana Card can be difficult for some vulnerable and rural populations, potentially limiting access to mobile financial services.
Regulators therefore face the difficult task of protecting the financial system without excluding the very people mobile money was designed to serve.
Escalating Fraud and Cybersecurity Threats
As mobile money transactions continue to surge, so do digital fraud and cybercrime. Dr. Atuahene notes that fraudsters increasingly target mobile money platforms because of their widespread use and growing transaction volumes.
He points to data showing that between January and September 2025, Ghana recorded more than 2,000 cybercrime incidents, many linked to mobile money fraud, with losses exceeding GH¢19 million.
Without stronger monitoring and cybersecurity safeguards, he warns, scams, unauthorised transactions and data breaches could continue to erode public confidence in digital financial services.
The “Too Big to Fail” Risk
Another growing concern is market concentration. Dr. Atuahene observes that MTN Mobile Money dominates Ghana’s mobile money market, making the system increasingly dependent on a single operator.
He warns that any prolonged system outage, operational failure or loss of public confidence in such a dominant provider could disrupt retail payments across the country and create wider economic consequences.
In his view, MTN Mobile Money’s scale and deep integration with Ghana’s financial system increasingly resemble characteristics of a systemically important financial institution.
Liquidity and Float Management
Dr. Atuahene also points out liquidity management as a critical regulatory concern. Mobile money operators hold billions of cedis of customers’ funds, known as “float”, in trust accounts with commercial banks.
Because these funds underpin millions of daily transactions, regulators must ensure adequate liquidity is always available to enable customers to access their money.
Any mismanagement, he warns, could trigger payout difficulties during periods of stress and undermine confidence in the entire mobile money ecosystem.
Monetary Policy and Banking Sector Pressures
The consultant further argues that the rapid growth of mobile money presents broader macroeconomic challenges. Large volumes of e-float deposits and digital transaction flows increasingly influence liquidity within the banking system, potentially affecting the Bank of Ghana’s monetary policy operations.
At the same time, mobile money’s growing popularity continues to reshape competition within the financial sector, with implications for traditional banks’ deposit mobilisation and profitability.
Consumer Protection and Hidden Charges
Consumer protection remains another area requiring greater regulatory attention. According to Dr. Atuahene, rapid innovation often outpaces regulatory capacity, leaving users exposed to hidden charges, inadequate dispute resolution mechanisms and inconsistent service standards.
Without stronger oversight, he says, trust in digital financial services could gradually weaken.
The Bottomline
Dr. Atuahene maintains that although Ghana’s mobile money ecosystem has demonstrated remarkable resilience and transformed access to financial services, regulators cannot afford to rely on existing frameworks.
As mobile money becomes increasingly interconnected with banks and the wider economy, he argues that regulatory frameworks must evolve to close arbitrage loopholes, strengthen consumer protection, enhance cybersecurity oversight and safeguard financial stability without undermining innovation and financial inclusion.
