9 FINANCIAL INCLUSION Access to formal financial services is extremely limited in Mozambique and most other developing countries. The majority of rural area inhabitants do not have access to banking facilities and are normally left out of the formal banking services. In Mozambique, only one in five households has access to formal banking services, meaning deficient access to formal savings. At an individual level, the 2017 After Access Survey shows that nine out of ten of Mozambicans older than 15 years do not have access to a banking account. Following the success of mobile phones, especially in rural areas, Mozambican authorities passed legislation in 2004 allowing mobile operators to partner with financial institution to provide mobile money services. Mobile money was launched in Mozambique in 2011 by mCel through its sister company Carteira Movel (branded mKesh). Vodacom later launched its mobile money services, M-Pesa, in 2013. As of 2016, there were about three million mobile money subscribers in Mozambique.2 The Survey shows that five out of ten mobile phone users use mobile money in Mozambique (see Figure 14). Mobile money is more common in urban areas than in rural areas, as 63 percent of mobile phone users in urban areas use mobile money and only 29 percent in rural areas. 47% 51% None Mobile banking 2% Mobile money Figure 14: Mobile money and mobile banking splits Source: RIA After Access survey data, 2017 As seen in Figure 15 below, the most common transaction performed on mobile phones is the topping up of air time (91%) – a somewhat expected finding since prepaid air time is the common currency of mobile markets in Africa. However, Mozambicans show how prevalent mobile money is, and important for the sustaining of their livelihoods, by declaring the receiving of payments as the second most common transaction (69%). This indicates how important mobile phones are in including citizens into the digital economy with digital finance, a point further supported by the third most-popular transaction: the paying of bills (30%). Airtime top up 91 Receive payments 69 30 Bill payments 13 Other 3 Salary payments 2 Receive pension Insurance payments 0 0 25 50 75 100 Figure 15: Use of mobile phone for transactional purposes (multiple answers) Source: RIA After Access survey data, 2017 2 See Feinstein, E. (2017). The e-commerce and digital payments landscape in Mozambique. Available at: http://blog.directpay. online/ecommerce-digital-payments-landscape-in-mozambique Financial inclusion 12