Informal Firms' Adoption and Use of Mobile Money Under Uncertain Times: Evidence From Burkina Faso

ABSTRACT This paper investigates how uncertainty affects mobile money adoption and use by informal businesses. Despite the prevalence of the informal sector in developing countries and the recognized potential of mobile money for financial inclusion, empirical research on its adoption and usage among unregistered businesses is limited. Therefore, our study aims at filling this gap by taking into account the impact of the COVID‐19 shocks as well as recent political turmoil in Burkina Faso. We consider three waves of business survey data from a quasi‐experimental introduction of mobile money merchant accounts in March 2021. Using linear probability and random effects models, our findings indicate that security is a critical factor driving merchant account adoption and usage after accounting for business and owner characteristics. However, temporary business closures during COVID‐19 negatively affect merchant account adoption while positively affecting its usage. Overall, this study supports global policy efforts to enhance financial inclusion among private sector businesses through mobile technology.