The Decline of Cash: Is Africa Ready for a Fully Digital Economy?
Byline: By Kwame
Accra, Ghana — At a bustling roadside fruit stand in the suburb of Adabraka, 32-year-old trader Abena Owusu expertly arranges bunches of bananas and pineapples while checking her smartphone for mobile money alerts.
“I hardly use physical cash anymore,” she says. “Most of my customers prefer to pay via Momo. It’s quicker, and I don’t have to keep too much change on me.”
Once a luxury for the tech-savvy elite, digital payments have become a fixture of everyday life in many African cities. From market vendors to taxi drivers, the decline of cash is visible — and irreversible. But the rapid shift has also exposed deep gaps in infrastructure, literacy, and trust.
A Mobile Money Revolution
Africa is home to more than 70% of the world’s mobile money accounts. In Ghana alone, the Bank of Ghana estimates that mobile money transaction volumes crossed ₵1 trillion in 2023, a staggering figure that has tripled since 2019.
“Mobile money has democratized access to finance,” says Rita Ababio, a fintech consultant based in Accra. “People who were previously excluded from the formal banking system can now save, send, and receive money from anywhere.”
She adds that for the unbanked — especially in rural areas — mobile platforms offer the only viable alternative to risky cash handling or high-fee informal money lenders.
Winners and Losers in a Cashless Shift
While many have benefitted, others are falling through the cracks.
In Kumasi, 58-year-old cobbler Kofi Osei prefers to receive payment in physical notes. “I don’t understand these apps,” he says, waving off a customer’s offer to pay digitally. “And sometimes, network is bad.”
His fears are not unfounded. According to the Ghana Chamber of Telecommunications, over 25% of mobile money transactions fail due to network outages, user error, or unlinked IDs. For older adults and those with limited education, digital finance can be alienating.
A Young Generation Adapts Fast
At the University of Cape Coast, 20-year-old student Ama Mensim buys meals, pays for photocopies, and even splits bills with friends — all through her smartphone.
“We don’t carry cash anymore. You’re more likely to forget your wallet than your phone,” she laughs.
Ama’s experience reflects a generational divide. Digital finance adoption is significantly higher among youth aged 18–35, especially those with access to smartphones and social media.
Infrastructure Isn’t Catching Up Fast Enough
Despite the enthusiasm, Ghana’s digital infrastructure is still a work in progress.
“In rural areas, even basic mobile connectivity is a problem,” says Ernest Owusu, a network technician based in the Upper West Region. “During storms, mobile service can disappear for hours.”
In these zones, the push for a digital economy risks marginalizing entire communities.
The Ghana Investment Fund for Electronic Communications (GIFEC) has pledged to expand coverage to underserved areas, but implementation has been slow and politically entangled.
The Shadow of E-Levy
The government’s introduction of the Electronic Transfer Levy (E-Levy) in 2022 also dampened enthusiasm. Meant to boost revenue, the tax applies to certain digital transactions — drawing public backlash and driving many back to cash.
“I stopped using Momo for a while,” says Grace Danso, a boutique owner in Takoradi. “Every transfer felt like punishment.”
Although the government later revised the rate and exempted low-income transfers, trust has not fully recovered.
Security: A Growing Concern
Digital fraud is another rising threat. According to the Cyber Crime Unit of the Ghana Police Service, mobile money scams increased by over 30% in 2023.
“I was duped by someone pretending to be a customer,” recounts taxi driver Peter Aidoo. “They sent me a fake confirmation SMS and vanished. I lost ₵150.”
In response, telcos and fintech firms have tightened verification processes and implemented AI fraud detection systems — but scammers continue to evolve.
The Cashless Dream: Too Soon?
While many believe in the vision of a fully digital economy, experts urge caution.
“A cashless future must be inclusive, not coercive,” says Professor Angela Boateng, an economist at the University of Ghana. “We can’t build a system that leaves out the elderly, the uneducated, or the rural poor.”
She warns that over-reliance on digital platforms without improving digital literacy and infrastructure could deepen inequality rather than solve it.
Everyday Realities: Cash Still Reigns in Many Areas
Despite the surge in mobile money usage, physical cash is far from dead.
In Tamale, bus drivers still demand coins. In remote farming communities, livestock is still bartered. And for those who mistrust formal systems or don’t own phones, cash remains king.
Back in Adabraka, trader Abena confirms this reality. “Some people still want to pay with coins or small notes. I accept both,” she says. “You have to meet your customer where they are.”
Looking Ahead: A Blended Future?
Rather than replacing cash outright, many experts believe Africa’s financial future lies in a hybrid model.
“Think of it like language,” says fintech analyst Kofi Nyame. “We don’t all speak English, and that’s okay. As long as systems talk to each other — cash, card, Momo, crypto — then everyone can participate.”
For now, the digital tide is rising. But whether Africa is ready for a fully cashless economy is a question that must account for access, trust, and humanity.