Janine Aron and John Muellbauer

This paper introduces the novel phenomenon of mobile money, its regulation and its important role globally in the financial inclusion of the poor and unbanked. It examines possible channels for the economic influence of mobile money and evaluates new empirical evidence on the impact of mobile money.

The paper emphasises the interconnectedness of the many facets of mobile money: enabling regulation for mobile money operations; profitable, innovative and sustainable mobile money networks; greater international and regional network connectedness and the transfer of technology; financial inclusion and the improved financial literacy for the poorest, including the neglected participants, women and rural dwellers; promotion of trust in evolving and more efficient business networks; better functioning e-Government with less “leakage”; well-directed donor support and effective academic research. There are also important externalities including the reduction of corruption and the fostering of the “formalisation” of economies, and improved health and climate outcomes.

This paper offers conclusions, wide-ranging lessons and policy recommendations. If these are disseminated and coordination is managed judiciously, this could lead to a virtuous circle for the many participants and players.