AN ASSESSMENT OF THE FACTORS INFLUENCING THE ADOPTION AND USE OF MOBILE MONEY SERVICES IN CAMEROON(A CASE STUDY OF SMEs IN YAOUNDE)

CHAPTER ONE

INTRODUCTION

Background of the Study

Numerous nations rely heavily on the economic contributions of small and medium-sized enterprises (SMEs) to propel their economies. Because they promote wealth generation, economic growth, and employment, they are essential to socioeconomic development (Verkijika, 2018) . A 2018 tally of businesses in Cameroon estimated that SMEs make up 99.8% of all businesses in the nation (NIS, 2018). Moreover, it was shown that 72% of Cameroon's permanent jobs were produced by SMEs (NIS, 2018). Few of them are regarded as structurally and financially sound, although employing over 72% of the labour force and contributing roughly 35% of the country's GDP (Ministry of Small and Medium Sized-Enterprises,2018). The majority of Cameroon's SME sector (about 97%) are family-run or sole proprietorships (NIS, 2018). It was also observed that the managers of these SMEs had relatively low levels of education, with about 85% of them being such. SMEs frequently rely heavily on cash due to their organisational structure and the management styles of their managers (Muiruri, 2019). Mobile money is a contemporary method for sending money fast using a mobile phone. Business owners and customers can use their mobile phones to conduct a variety of financial activities with this electronic wallet. With over 15 million users, mobile money is currently accessible in thirteen Middle Eastern and African nations. Since September 2011, the service has been offered in Cameroon in collaboration with a few commercial banks that guarantee regulatory compliance ( Kamal, 2018). Since 2014, the phenomenon has been on the rise. Currently, there are more than 700 payment locations throughout the nation (INS). Due to its broad scope of Yaounde security, confidentiality, and speed, this novel idea has been easily incorporated into Cameroonian customs and daily life. The IFC (2021) research states that one of the features of mobile money services is the ability to transfer money using a cell phone. This innovation is utilised by small enterprises as well as individuals for money transfers. It alludes to the use of mobile devices for banking and financial operations (IFC Mobile Money report, 2021). This concept covers a wide range of services, such as mobile banking (e.g., account balance queries), finance (e.g., insurance products), and payments (e.g., person-to-person transfers, utility payments) (Donovan 2022). Around the world, mobile money has grown at an incredible rate. This is especially true in developing and emerging nations, where populations that have historically been shut out of the formal financial system are now able to access financial services and the internet in greater numbers than ever before (GSMA 2018). Therefore, a survey will be conducted to assess the factors influencing the adoption and use of mobile money services in Cameroon.

Statement of the Problem

The level of financial participation among users of mobile money services is heavily influenced by the acceptance and adoption of mobile money technology. In Cameroon, where mobile phone users comprise over 93% of the population, there exists a significant opportunity for enhancing financial inclusion through mobile-based services (GSMA, 2018). The commitment of the Cameroonian government to foster the growth of mobile money services is evident in the National Financial Inclusion Strategy (NFIS) for 2017-2022, emphasizing accessibility, innovation, and customer-centricity of products (Cameroon's National Financial Inclusion Strategy, 2017-2022).

Despite the implementation of various initiatives by Mobile Network Operators (MNOs), the adoption of mobile money services remains relatively low in Cameroon. The GSMA report of 2018 indicates a 96% cell phone penetration at the household level, with 67.2% of the population being aware of mobile money services; however, only 29.5% have actually used them (GSMA, 2018). Even among those who have used mobile money services, a significant portion does not fully utilize the range and quality of available services, indicating a gap in achieving comprehensive financial inclusion. Nevertheless, to promote broader adoption and effective utilization of mobile money services in Cameroon, it is imperative to address various factors influencing their usage. This includes ensuring the availability and accessibility of services, promoting frequent usage, and offering suitable and high-quality financial options catering to all income levels in the country. It is in the light of these that the study seeks to assess the factors influencing the adoption and use of mobile money services in Cameroon.

 1.3  Objectives of the Study

The main purpose of this study is to assess the factors influencing the adoption and use of mobile money services in Cameroon. Specifically, the study will;

Find out the extent mobile money services have been adopted for use in Cameroon.

Determine the factors affecting consumer’s adoption and use of mobile money services in SMEs in Yaounde, Cameroon.

Identify the effects of the adoption and use of mobile money services among consumers in Yaounde, Cameroon.

1.4 Research Questions

The following questions have been prepared for the study:

To what extent has mobile money services been adopted for use in Cameroon?

What are the factors affecting consumer’s adoption and use of mobile money services in SMEs in Yaounde, Cameroon?

What are the effects of the adoption and use of mobile money services among consumers in Yaounde, Cameroon?

1.5 Research Hypotheses

Ho: There is no significant influence of factors on the adoption and use of mobile money services in Cameroon.

Ha: There is a significant influence of factors on the adoption and use of mobile money services in Cameroon.

1.6  Significance of the Study

The factors that impact the adoption and use of mobile money services in Cameroon have substantial consequences for financial inclusivity, economic progress, policy creation, innovation, and empowerment. However, the research results will provide SMEs owners and customers in Cameroon with the benefits of adopting and using mobile money services. Also, it will help financial institution tailor services to meet the specific needs of different user segments, thereby fostering greater empowerment and economic resilience. with convenient, secure, and affordable financial solutions, thereby fostering greater empowerment and economic resilience. Additionally, the study will help identify areas for improvement, innovation, and customization of services to better meet the needs of users in Cameroon. Furthermore, subsequent researchers will use it as a literature review. This means that other students who may decide to conduct studies in this area will have the opportunity to use this study as available literature that can be subjected to critical review. Invariably, the result of the study contributes immensely to the body of academic knowledge with regard to the  factors influencing the adoption and use of mobile money services in Cameroon.

1.7 Scope of the study

The scope of this study is boarded on the factors influencing the adoption and use of mobile money services in Cameroon. Empirically, this study will determine the factors affecting consumer’s adoption and use of mobile money services in SMEs in Yaounde, Cameroon, investigate the appropriate mechanism in assessing the ease and usefulness of mobile money services in SMEs in Yaounde, Cameroon and identify the opportunities with the adoption and use of mobile money services among consumers in Yaounde, Cameroon.

Geographically, the study will be delimited to resident of Yaounde, Cameroon.

1.8 Limitation of the study

In the course of carrying out this study, the researcher experienced some constraints, which included time constraints, financial constraints, language barriers, and the attitude of the respondents. In addition, there was the element of researcher bias. Here, the researcher possessed some biases that may have been reflected in the way the data was collected, the type of people interviewed or sampled, and how the data gathered was interpreted thereafter. The potential for all this to influence the findings and conclusions could not be downplayed. More so, the findings of this study are limited to the sample population in the study area, hence they may not be suitable for use in comparison to other schools, local governments, states, and other countries in the world.

1.9 Definition of Terms

Mobile money: a digital financial service that allows users to perform various financial transactions using their mobile devices, such as smartphones or basic feature phones.

Consumer: is an individual or entity that purchases goods or services for personal use or consumption.