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Mali Seeks to Boost Digital Currency Compliance Amid Growing Financial Inclusion

The West African nation of Mali is taking significant steps to enhance its digital currency compliance as it seeks to increase financial inclusion among its citizens.

Significant Progress in Access to Financial Services

According to a recent World Bank policy note, the country’s dynamic financial sector has seen significant growth in access to financial services. Mobile money has increased as a share of GDP from 21% in 2015 to 65% in 2021. However, despite this progress, Mali still lags behind other countries in the region when it comes to digital payments.

  • Only 38% of Malian adults received a digital payment in 2021.
  • Compared to 79% in Kenya and 49.5% in Ghana.

The Government’s Commitment to Financial Inclusion

The government is committed to increasing access to financial inclusion through its 2021-2026 National Financial Inclusion strategy, which aims to support the vulnerable with social payments delivered through an account. The Jigisemeyiri Project has already distributed cash transfers to 62,000 households suffering from food insecurity during the pandemic.

Challenges Remain at Infrastructure, Regulatory, and Market Levels

Despite these efforts, challenges remain at the infrastructure, regulatory, and market levels. Mali’s government wants to connect its Public Treasury to the regional switch to scale digitization of government payments, but inefficient interface connection to the regional switch limits public and private stakeholders in Mali from using the payment system and creates interoperability issues.

  • The credit infrastructure is limited.
  • The institutional framework needs to be strengthened.
  • Credit bureau regulations exclude client data from prepaid service utility bills, hindering alternative credit scoring methodologies.

Recommendations for Accelerating Digital Financial Services Adoption

To accelerate the adoption of digital financial services, Mali should:

  • Improve Financial and Digital Infrastructure: Connect to the GIM-UEMOA payment system and establish a national platform.
  • Update Regulatory and Legal Framework: Reflect technological changes and enable easier market entry for newcomers.
  • Adapt Technology to Local Financial Habits: Digitize micro-savings groups (tontines) and micro-insurance services developed by Malian women.
  • Introduce DFS Across Sectors: Multiply use-cases, strengthening the digital transformation by developing second-generation services: micro-credit, micro-insurance, and micro-savings.

By addressing these challenges and implementing these recommendations, Mali can enhance its digital currency compliance and increase financial inclusion among its citizens.