Notes to network: Innovation, digital shift in Ghana’s payment system

Ghana’s journey toward a cashless society is gaining momentum, driven by the adoption of digital payment platforms and collaborative efforts between stakeholders.

With significant progress made, the transition and navigating the path to a cashless economy presents both opportunities and challenges. 

Transition

A Digital Financial Services(DFS) and Fintech Communication Consultant, Eunice Asantewaa Ankomah,emphasises the transformative role of digital finance in Ghana’s economic shift.

“For any country to achieve a cashless or cash-lite status, the integration of technology into financial services is crucial,” she explains.

Ghana has made strides with initiatives such as the National Payment Systems Infrastructure and mobile money, which have facilitated digital financial inclusion and interoperability.

“The National Payment Systems Infrastructure laid the foundation for seamless payments, while mobile money introduced millions to digital financial services,” Mrs Ankomah adds.

The widespread acceptance of mobile money by both small and large businesses underscores its impact.

A World Bank report reveals that digital payment usage among Ghanaian adults rose from 26 per cent in 2014 to 66 per cent in 2021, highlighting the country’s progress toward a cashless future.

Groundwork, systems

Mrs Ankomah points out that, while Mpesa in Kenya pioneered the concept, MTN Mobile Money laid the groundwork for Ghana’s digital finance journey.

“Today, we have five mobile money operators, clear regulations and fintech companies digitising various payment processes,” she states.

The establishment of the Ghana Interbank Payment and Settlement Systems (GhIPSS) has been a game-changer, enabling interoperability among payment service providers.

This has created a conducive environment for innovation, ensuring the sustainability of digital payments.

Challenges

Mrs Ankomah identifies digital literacy as a significant barrier. “A large portion of the population, particularly in rural areas, lacks the skills and confidence to use digital payment services,” she explains.

Cultural reliance on physical cash also poses a challenge. Cash is still widely used for everyday transactions, particularly in the informal sector.

“Many vendors prefer cash for its liquidity and lack of transaction costs,” Mrs Ankomah notes.

“Additionally, the introduction of the e-levy has made digital payments less attractive due to the associated costs,” she continued.

Trust and security concerns are another hurdle. Fraud and data breaches deter some Ghanaians from embracing digital transactions.

“Building trust through robust security measures and continuous education is key,” Mrs Ankomah emphasises.

Innovations

Nonetheless, she believes that the future of finance in Ghana is digital. “Fintech innovations will continue to grow, offering tailored financial products and services,” she says.

Platforms such as the Pan-African Payment and Settlement Systems (PAPSS) promises to revolutionise cross-border payments, while the introduction of Central Bank Digital Currencies (CBDCs) could further enhance financial inclusion.