Assessment of the Factors Affecting Mobile Money Transactions in Tanzania

Abstract

The study aimed at assessing the factors affecting mobile money transactions in the country, with a focus on Yas agents in the Dar es Salaam City Council. It specifically investigated demographic characteristics that may influence participation in the mobile money business, and dwelt on the effects of inflation factors, financial factors, and multiple regulations on mobile money transactions. The target population is the Yas mobile money agents in the study area. A purposive sampling was used in the study to choose study participants. The methods of data collection were cross-sectional surveys using a structured questionnaire administered to a sample of 89 mobile money agents. Analysis was done using MS Excel to produce graphs, means (x̅) and standard deviations (Std dev). The results revealed that to a large extent (Mean 3.69, Std dev 1.91), respondents perceived that inflation factors have a strong impact on mobile money transactions. Secondly, the financial factors that strongly affect mobile money transactions were affordability, risks and financial inclusion (Mean 4.05, Std dev 2.11); while multiple regulations (Mean 3.94, Std dev 2.04) to a large extent also have negative effects on mobile money transactions. Interestingly, the study revealed that the majority of the agents (67%) have invested <500,000 TZS in this business, suggesting the concern of risks involved. The study concludes that challenges, including security concerns, issues with agent availability and liquidity, particularly in rural areas, need to be addressed. Furthermore, the study recommends that individual enterprises should have sufficient access to financial resources and that existing regulatory frameworks for electronic payments should be improved so that policies on mobile money focus on maintaining and enhancing confidence in the system