Michelle Kaffenberger

Mobile Money in the Democratic Republic of Congo: The indirect path may be most effective for small business payments

A large portion of the Democratic Republic of Congo’s (DRC) economy consists of small businesses, and most of them operate exclusively in cash. With only 4 percent of adults in DRC having an account at a formal financial institution, alternatives such as mobile money are key to improving the efficiency and security of small business payments.

A recent report by InterMedia and GSMA highlighted the opportunities for expanding mobile money use among small business owners. We found that significant opportunities exist in supplier payments and wage payments, but we also found that directly targeting small business owners alone might not be an effective means to encourage uptake. Instead, indirect routes, including targeting suppliers and employees, may also be necessary for speeding mobile money’s expansion.

Mobile money and supplier payments

Many small business owners said they would prefer a method such as mobile money for paying suppliers, rather than continuing with their current cash payments. Mobile money would save them the time required to deliver cash in person to their suppliers – time which they currently must spend away from their businesses. Mobile money would also prevent the insecurity inherent in traveling with large amounts of cash.

Most small business owners said, however, that their suppliers determine the payment method, meaning owners may have limited ability to initiate a switch to mobile money. Targeting small business owners alone, therefore, is unlikely to lead to widespread uptake for supplier payments. Mobile money operators may need to target suppliers and persuade them that receiving payments through mobile money is better than through cash.

Mobile Money and Wage Payments

Opportunities also exist for encouraging mobile money as a means for wage payments. Small business owners may experience some efficiency gains from switching from cash to mobile money, but employees are likely to benefit the most from the switch. Paying wages in cash is relatively quick and easy for business owners, but carrying a month’s worth of wages (most business owners reported paying wages once per month) in cash is risky for employees.

The impetus, therefore, may be on the employees to convince business owners to make salary payments in cash. Marketing efforts would need to focus on employees, persuading them that mobile money is better than cash and that they should request mobile money payments from their employer.

Targeting Small Business Owners

This is not to say that efforts should ignore small business owners altogether. Owners reported specific concerns that need to be addressed, such as fears of forgetting their PIN or losing their phone, lack of interoperability if a supplier or employee uses a different GSM network, and limits on withdrawals. Marketing aimed at small business owners will also work to persuade more owners of mobile money’s benefits.

The key, though, is that targeting small business owners alone is unlikely to bring about quick and widespread uptake of mobile money for payments. By identifying the needs of suppliers and employees and marketing their services to them, in addition to business owners, mobile money operators can produce a bigger impact on the market.


financial inclusion