Rwanda recorded Rwf10 trillion in mobile transactions last year, data by the central bank shows, owing to the increased awareness of the benefits of digital payments.

Figures show that more than five million subscribers in mobile payments made more than 900 million transactions last year, which amounted to slightly more than Rwf10 trillion.

The data were announced by the regulator at the monetary policy and financial stability statement on March 29.

While there has been a minor increase in the number of subscribers in mobile payment systems from 4.7 million to 5.1 million (2020-2021), the number and monetary value of transactions made have exponentially increased.

John Rwangombwa, the Governor of the central bank, explained that the trend is due to the continued awareness of the benefits of using digital channels and the increasing number of products available to attract the use of those channels.

"Covid-19 restrictions and people moving away from cash transactions also contributed to the increase,” he added.

The notable difference can be spotted in the increase from Pre-Covid numbers where transactions were below 400 million and their value below Rwf3 trillion in 2019.

Rwangombwa also noted that when it comes to internet banking, subscribers and transactions are negligible, however, the monetary value which is significant means that more corporate companies are using internet banking.

"This gives a good picture of the trend in our cashless economy.”

When you compare the value of transactions as a percentage of gross domestic product (GDP) it has been an increasing curve over the past five years, rising to 102.5 per cent in 2021.

Given the strides made in driving a digital economy, the population remains price sensitive, Rwangombwa said as he explained the impact of policy change on mobile payments.

When MTN Rwanda, the major contributor to merchant payments, re-introduced the fee of taking 0.5 per cent commission of payments received by merchants and businesses through Mobile Money in September 2021, there was a sharp drop in the monetary value of transactions made.

The drop was mainly characterised by person-to-business transactions.

However, when the central bank scrapped the push and pull charges between mobile wallets and banks in August last year, there has been a notable increase in volumes of transactions from wallets to bank accounts.

As of December 2021, more than Rwf200 billion funds were transferred into bank accounts and more than Rwf120 billion transferred into mobile wallets.

The overall trend demonstrates the uptake of digital payments by the public as the country continues to make strides in digitalizing the economy.

However, there remain hindrances in digital penetration such as low levels of digital devices and digital literacy among the people.

The government and telecom operators have teamed up to bridge the gap by distributing smartphones across the country.