In an age where technology is rapidly reshaping the financial landscape across the globe, one African region, in particular, has emerged as a fascinating case study. The Central African Economic and Monetary Community, known as CEMAC, consisting of countries such as Cameroon, Congo, Gabon, Chad, the Central African Republic (CAR), and Equatorial Guinea, is witnessing a profound transformation in its financial sector.
Mobile Money, a digital payment system, has quietly become a formidable contender against traditional banks in the CEMAC region. With a remarkable 37 million accounts registered in 2022, it’s evident that Mobile Money is on a trajectory to revolutionize financial transactions.
The latest report published by the BEAC, the common central bank for CEMAC countries, unveils some astonishing insights. In 2022, more than 96% of all transactions in the CEMAC zone, totaling 2.3 billion operations, were executed through Mobile Money. In stark contrast, a mere 2% of transactions, comprising 48.3 million operations, were conducted using traditional bank transfers and credit cards. This trend highlights the surging popularity and adoption of Mobile Money for day-to-day financial activities.
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However, the story is not just about numbers; it’s about the changing nature of financial transactions. Mobile Money predominantly caters to smaller transactions, reflecting the habits of economic agents conducting everyday business. For more substantial transactions, traditional banks still maintain their dominance, commanding 44% of transactions by value. This amounts to a staggering 48,573 billion CFA francs ($79M). Instant electronic money transfers represent 21% of transactions, translating to 23,332 billion CFA francs ($38M). In essence, while Mobile Money dominates in quantity, traditional banks continue to reign supreme in terms of larger, high-value transactions.
But what truly underscores the significance of this transformation is the sheer scale. In 2022, CEMAC was home to 498 payment service providers, facilitating a staggering 2.4 billion transactions. These transactions added up to a colossal total, exceeding 107,126 billion CFA francs ($174M).
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As the global financial landscape continues to evolve, this tale from the heart of Africa offers a compelling glimpse into the dynamic interplay between technology and finance. The rise of Mobile Money in CEMAC countries serves as an important case study for the growth of fintech in Francophone Africa, shedding light on the power of digital innovation in redefining how individuals and businesses handle their finances in the digital era.
Central Africa mobile money Central Africa mobile money
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard