Malawians continue embracing the use digital financial services (DFS) as the value of transactions processed in the second quarter of 2023 grew by 21 percent to K4.6 trillion, a recent Reserve Bank of Malawi (RBM) National Payment Systems report show.
The digital services include non-bank mobile money platforms, internet banking, mobile banking services and point of sale machines.
According to the report, during the period under review, the volume registered in digital money transactions also went up by 10.6 percent to 321.8 million, a development attributed to an increase in aggregate demand following the onset of the agricultural commodities trading period.
Major contributors to this trend in terms of both the volume and value of DFS transactions were internet banking and mobile money services which registered 14.2 percent and 11.6 percent with respect to volume of transactions and 25.5 percent and 19.6 percent with respect to value of transactions.
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“This trend shows that there is generally growing acceptance of DFS as the country’s most popular payment method over cash and other paper-based payment instruments,” the report reads.
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Meanwhile, as of June 2023, the number of non-bank mobile money services stood at 11.7 million, a rebound from the 10.9 million registered in the first quarter of 2023, representing an increase of 6.7 percent.
During the period under review, the total number of mobile money agents rose by 10.9 percent to 284,355 while subscribers for internet banking services decreased by 2.2 percent to 237,367, a continuation of the trend experienced in the first quarter of 2023.
At the same time, the number of mobile banking subscribers increased by 52.1 percent to 1.5 million compared to March 2023 and the total number of Point of Sale (POS) terminals deployed across the country by commercial banks registered a marginal increase of 0.8 percent to 4,958 during the period under review, from 4,918 during the first quarter of 2023.
In an interview, economist Edward Chilima said with the increase in international trade, it is imperative that the financial system goes digital to be able to transact adding that even though it comes with high costs in terms of infrastructure, the benefits outpace the costs.
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Chilima added that digital transactions promote financial inclusion, reduces costs for the country especially the central bank in printing cash and poses less risks than carrying cash among other benefits.
“Given that the financial services are global, it is critical that an economy like Malawi invests in digital financial services in order to cope, compete and transact on the international market efficiently,” Chilima said.
Malawi has a number of platforms that support digital means of payment and lately, utilisation of such platforms has been on the rise.
