Are Mobile Money and Financial Accounts Complementary? Evidence from the WAEMU Region

The recent mobile money innovation has experienced strong development and has been a key tool for financial inclusion in sub-Saharan Africa. Even holders of formal financial accounts have adopted it widely. Based on a sample of 6,891 households in the West African Economic and Monetary Union (WAEMU), we study complementarity between the use of mobile money and financial accounts. Our empirical results show that households generally perceive mobile money and financial accounts as substitutes. We also found that individuals for whom the two accounts are complementary have a high level of education and live in countries where formal financial and mobile money services are more accessible. Moreover, contrary to previous works, we show that among those holding two complementary accounts, almost 50% find that the formal financial account is a complement of mobile money. We attribute this preference to a very low use of financial services such as formal savings and borrowings in WAEMU.