The impact of mobile money on Rwandan household consumption

Research on consumption patterns in developing countries shows that precautionary savings behaviour is common. This is driven by high-risk exposure to natural and economic shocks, and a lack of formal insurance mechanisms among rural farming households. The spread of mobile phones has introduced mobile money, which offers new financial opportunities to marginalized groups. This study examines mobile money's impact on consumption in Rwanda, using data from the Rwanda FinScope 2020 Survey. It applies probabilistic models and an instrumental variable approach to explore the relationship between mobile money use and consumption. The study finds that mobile money is financially inclusive and increases the likelihood of higher consumption among households. Remittances, representing financial flows between households, are key to this increased consumption smoothing. The findings suggest further research is needed to investigate whether household welfare improvements align with positive consumption patterns.

Grantor dc:publisher.institution

School of Economics

Year dc:date.issued

2025

Author dc:creator

• Cedras, Joshua

Advisor dc:contributor.advisor

• Hollander, Hylton

• Rwanda
• Mobile Money

Language dc:language.iso

en

Handle dc:identifier.uri

http://hdl.handle.net/11427/42271

OAI identifier oai:identifier

oai:open.uct.ac.za:11427/42271