Mobile phone technology and financial inclusion among rural population of the Upper Denkyira West District

Abstract

Over the years, financial inclusion has gained interest in both economic and financial discourse and it has a development policy especially in developing economies. Developing countries such as Ghana are developing various policies and regulatory framework to ensure they reach all those excluded financially especially the rural dwellers. Mobile phone technology has served as an option for rural populace to embark on financial transaction such as payment, transfers, savings and mobile banking. The study therefore examines the role of Mobile phone technology in providing financial inclusion among rural population of Upper Denkyira West District. Using structured questionnaire for a sample size of 400 respondents, the study used both probit and multinomial regression as an estimation technique. It was found that, the usage of mobile phone technology have a positive effect on financial inclusion among rural population of Upper Denkyira West District. The study further found age, average income, household size, perceived trust and employment as the factors that influence the usage of mobile phone technology in providing financial inclusion. Also, the study found transaction cost, distance to bank, trust, volume of transaction, income, age, household size and employment as the factors that determine the usage of bank account, mobile phone and both for making transaction. In other to ensure inclusive finance in rural Upper Denkyira West District, the study recommends that, the Ministry of Finance through Ghana revenue authority should reduce taxes for mobile network Operators. Bank of Ghana should charge financial sectors such as microfinance institutions to build branches in these areas and also implement policies that aim at restoring individual’s confidence in the usage of financial institutions.