Is Mobile Money Associated With Remittances?




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Remittances have become extraordinarily important due to their spectacular and seemingly non- stoppable growth for many countries. This thesis analyzes the association of Mobile Money, a payment system operating through mobile phones designed to improve financial access for the under and unbanked, with remittances. The hypothesis that Mobile Money is positively related with remittances is generally confirmed by literature, arguing that Mobile Money has driven financial inclusion and transaction cost reductions. The presented empirical panel data analysis of 26 countries from 2011 to 2020 associated a 1% increase of active Mobile Money accounts with an approximate 0.074% increase in received per capita remittances on a 10% level of statistical significance. A 100% increase, or duplication, of active Mobile Money accounts would be associated with an approximately 5.3% increase in per capita remittances. Furthermore, estimates generally go in the theorized direction even if non statistically significant. This thesis provides a good starting point for future research on the field, which can undoubtedly be conducted with improving data availability in the future.



Economics, General