Mobile money services and financial inclusion in rural Uganda, a case study of mobile money users in Buikwe district

Abstract

The study examined the relationship between mobile money services and financial inclusion in rural areas in Uganda using a case study mobile money users in Buikwe district. Specifically, the study examined: the relationship between mobile payment services and financial inclusion; the relationship between mobile finance services and financial inclusiveness; and the relationship between mobile banking services and financial inclusiveness in Buikwe district. A cross – sectional research design was used with a quantitative approach. A sample size of 200 respondents was selected from a study population of 400 using Yamane‟s formula. Data was collected by using a Likert scale based questionnaire containing five choices; strongly agree, agree, not sure, disagree and strongly disagree. Data was analyzed using Mean and standard deviation, Pearson correlation and regression analysis with the help of Statistical package for social sciences (SPSS) version 20. The established a significant positive relationship between: mobile payments and financial inclusion (r = 0.620, p = 0.000); mobile finance and financial inclusion (r =0.601, p = 0.000); and a significant positive relationship between mobile banking and financial inclusion (r = 0.507, p = 0.000). Additionally, the overall R square of the variables was 0.555 indicating that 55.5% of financial inclusion can be explained by mobile payments, mobile finance and mobile banking. Consequently, it was concluded that mobile payments, mobile finance and mobile banking significantly contribute to financial inclusion in rural areas in Uganda, where a change made in one of the independent variables can lead to a change in financial inclusion in rural areas. It was recommended that: there should be constant provision of mobile payment services, mobile finance and mobile banking services by telecom operators since they all play a significant role in deepening financial inclusion in rural areas.