Paper
Mobile-Phone Banking and Low-income Customers: Evidence from South Africa
Analyzing adoption of mobile banking among the poor
This paper presents survey findings on perceptions and usage of mobile banking (m-banking) among low-income people in South Africa.
The study was conducted on 515 low-income individuals. Of these, 300 individuals did not use mobile banking and 215 individuals were customers of WIZZIT, a start-up mobile banking provider. Four main findings emerged from the surveys. They are:
- Low-income customers value WIZZIT's m-banking service, and rate it high on convenience, cost, and security;
- WIZZIT's users are better-off in terms of income and assets than the poorest South Africans, and are more financially and technologically sophisticated;
- Respondents valued human interaction, but were open to using new technology;
- Low awareness and negative perceptions about m-banking prevent non-users from adopting the service.
The paper presents the Financial Services Measure developed by FinMark Trust for segmenting individuals to predict use of formal financial services. It discusses the relative cost of operating WIZZIT and perceptions of respondents about available banking channels. The paper states that perceptions about banking, m-banking and technology influence their adoption rates.
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