ABSTRACT

The importance of financial inclusion especially in the developing world cannot be overemphasized. Several researches have pointed to the positive impact of financial inclusion on poverty reduction and financial integration. Provision of suitable financial services by traditional banks is hampered by poor road infrastructure, high cost of fees, amongst others. Financial exclusion mostly plagues the poor and vulnerable including women and households in rural and semi-rural areas. With estimated mobile phone ownership of 38.8 million in Ghana (NCA, 2017), innovative mobile telephony technology solutions such as mobile money and mobile banking stand to offer potential channels to further financial inclusion. This study explores the ownership and usage of mobile telephony technology of households in Ghana to ascertain their impact on financial inclusion. The objectives therefore were to assess the determinants of mobile telephony adoption in Ghana and to determine whether mobile telephony technology can be leveraged to achieve financial inclusion in Ghana. It also looks at whether access to financial services enhances the capacity of households to own and use mobile phones. The study is quantitative in nature with data sourced from the Ghana Statistical Services Department; specifically, the Ghana Living Standards Survey (GLSS) R6 Report (2014), an authentic and rich data source on households in Ghana. Overall, 15 households from 1,200 enumeration areas were selected using a stratified sampling process for the GLSS R6 Report. Latent Simultaneous Variable Model was employed using seemingly unrelated bivariate probit to analyze the data. The results of the study show that mobile penetration; that is mobile phone ownership and usage can be leveraged on to achieve financial inclusion in Ghana. Again, the results further show that financial inclusion of households significantly increases the probability vi of mobile phone ownership and usage. The results further indicate that males are more likely to own mobile phones than females. Community infrastructure characteristics are also found to impact both financial inclusion as well ownership and usage of mobile phones. These findings provide useful guide for government and the National Communication Authority for policy prescription in enhancing the regulation of the sector. The provision of necessary policy framework for the Mobile Network Operators (MNOs/Telcos), will help to bring about unleashing of relevant products and services for the consumption of households with the object of enhancing financial inclusion.