Development Results Focused Research Program: Country Diagnostic - Malawi

This paper measures the current state of the transition to electronic payments by estimating volumes and values of payments in Malawi. It assesses the likelihood of further movement by looking at payment use cases associated with each key shift. It also identifies specific examples of attempts to shift to electronic payments that could generate lessons for concerned stakeholders engaged in similar work in other contexts. In addition, the paper evaluates gaps in the available data that can be filled to give valuable insights for designing and monitoring further efforts to shift toward electronic payments. Key findings include:

• While several services enable customers with bank or mobile money accounts to make remote bill payments, few are widely used within Malawi;
• While mobile banking services can be used to make remote utility payments, customer take-up appears to be low;
• Lack of efficient and effective interoperability is a key detriment to achieving a shift away from cash to make payments;
• Co-branding ventures between banks and retailers have not driven significant additional adoption and use of cards to make purchases;
• Web-based remote bill payment services are not widely used within Malawi, given the small proportion of the population with Internet access.