Factors Influencing Mobile Money Adoption in Tanzania

Financial inclusion is being promoted in most economies as it fosters economic development. Traditionally, banks were used to promote the agenda of financial inclusion until about two decades ago when Mobile Network Operators (MNOs) introduced mobile money services. Since then, there has been a rise in the number of individuals using mobile money services. Due to this, studies have been carried out to investigate the factors responsible for adopting mobile money globally. Despite thorough research in this area, aspects such as affordability and integration of mobile money with other financial services and promotions have not been thoroughly studied. Therefore, with its unique focus on these unexplored new aspects, this study was carried out to fill this gap using Tanzania as a case study. Along with the common factors such as trust, performance, and ease of use, the study used primary data collected through an online survey from 384 respondents. It was anchored on the Technology Acceptance Model (TAM) and employed Semi-Structural Equation Modeling (SEM) as the analysis method. The study found that perceived risk has a negative but statistically insignificant influence on adopting mobile money, with a coefficient of -0.181 and a p-value of 0.078. Results also indicate that perceived trust, performance expectancy, ease of use, social influence, affordability, integration of mobile money with other financial services, and promotion have a positive and statistically significant influence on mobile money adoption, with coefficients of 0.694, 0.627, 0.623, 0.605, 0.101, 0.083, and 0.438 respectively, and a p-value of less than 0.005. These findings highlight the need for MNOs to build trust through improved security measures, offer affordable services, integrate mobile money with other financial platforms, and promote their services to increase adoption. Policymakers are encouraged to create regulatory frameworks that promote consumer trust, ensuring a safe and reliable mobile money ecosystem.