Influence of Mobile Money on Economic Growth in Sub-Saharan Africa as Moderated by Financial Stability.

Abstract:

This study investigates the influence of mobile money on economic growth in SSA, with a special focus on the moderating role of financial stability. The primary objective of the study is to assess whether the economic benefits of mobile money are conditional upon a stable financial environment. To achieve this, the study employs a quantitative research design, utilizing panel data from 38 SSA countries spanning the period 2000 to 2023. Mobile money adoption, financial stability, and economic growth are each measured using composite indices constructed from multiple indicators. The empirical analysis is conducted using the system Generalized Method of Moments (GMM) to address endogeneity and capture dynamic relationships. The findings reveal that while mobile money does not independently exert a statistically significant effect on economic growth, its interaction with financial stability is both positive and significant. This indicates that mobile money contributes to growth only when supported by a stable financial system. Control variables such as education and inflation are also found to be significant, reinforcing their importance in SSA’s development trajectory. The study offers key practical and theoretical implications. For policymakers, the results suggest that expanding mobile money infrastructure must be complemented by institutional reforms that bolster financial stability. For accounting and development researchers, the study provides a novel framework for integrating digital financial metrics into macroeconomic modeling. These insights contribute to the evolving discourse on financial inclusion, institutional quality, and sustainable growth in Africa.