ISSER ReFinD Report Reveals Low Digital Finance Adoption Hindering Informal Sector Growth

A new data-driven research report under the Retail Financial Distribution Research initiative championed by ISSER has revealed that digital payment adoption among firms in Ghana remains low, especially within the informal sector, despite its proven benefits for business growth and efficiency. 

The report, titled “Firms and Digital Payments: Evidence from Censal Microdata,” provides the first census-level assessment of digital financial services (DFS) adoption among 1.8 million firms in Ghana.

It was launched on April 8, 2025, at the Institute of Statistical, Social and Economic Research (ISSER), University of Ghana. Findings from the study show that while larger firms tend to diversify their revenue collection channels, including digital payments, many smaller businesses continue to rely on personal mobile money accounts, one of the costliest and riskiest methods for business transactions.

The study also highlights that digital payment adoption significantly improves business outcomes such as revenue, employee size and formalisation. 

A key insight from the research is that male-owned businesses, managed by females outperformed their counterparts across various performance indicators. These businesses were more likely to adopt digital payment systems and exhibited better growth, especially in the formal and service sectors. 

Commenting on the findings, the Director of ISSER and lead researcher on the project, Prof. Peter Quartey, noted, “Only about 37 percent of the surveyed firms reported using digital payment systems, mainly due to the convenience and security they offer. However, the introduction of the E-Levy affected adoption and despite its removal, transaction costs remain a concern.” 

He stressed that many firms struggle with limited knowledge, the lack of trust in the digital systems and low returns on digital investment. “Financial literacy gaps are real,” he said. “We need interventions in local languages and with practical demonstrations to ensure meaningful adoption, especially among women and micro businesses.” 

Prof. Quartey also revealed ISSER’s upcoming study, which will involve installing CCTV cameras to monitor the sense of security among patrons of mobile money vendors and to explore possibilities of extending vendor working hours to enhance access and trust. 

Touching on broader structural issues, the CEO of the Ghana Chamber of Telecommunications and the Electronic Money Issuers Chamber of Ghana, Ing. Dr. Kenneth Ashigbey, called for a shift in how Ghana views the informal sector. “We must stop viewing the informal sector as just ‘informal.’ It is the real sector and a critical contributor to Ghana’s economy,” he stated. 

He underscored the need to improve digital inclusion through targeted efforts like increasing smartphone penetration and ensuring devices are configured with applications in local languages to enhance adoption and usability. He further noted the importance of improving access to digital payments, insurance and other financial tools to drive holistic growth. 

The report forms part of ISSER’s ReFinD (Retail Financial Distribution) initiative and serves as a major step toward informing inclusive policies that bridge Ghana’s digital financial gap, reduce risk and improve access for underserved businesses. 

The event, convened to launch the report under the theme “Advancing Digital Payments for Businesses in Ghana,” drew participation from a high-level panel of experts and stakeholders in the digital finance space. 

Mr. Kwame Oppong, Director of Fintech & Innovation at the Bank of Ghana, delivered the keynote address, emphasising the centrality of innovation and regulatory support in accelerating digital financial services in Ghana. 

Prof. Francis Annan, Assistant Professor of Economics at the University of California, Berkeley and Lead for the Scientific Committee and Co-Principal Investigator (Co-PI) of ReFinD, served as the Theme Setter, laying the groundwork for the discussions that followed. The Gates Foundation, a major partner in the initiative, was represented by Dr. Seth Garz, Deputy Director for Data & Evidence on the Women’s Economic Empowerment Team, who gave remarks alongside Victoria Griffith, Senior Programme Officer, Financial Services for the Poor. 

A vibrant panel discussion featured key industry leaders including Mr. Kwaku Tettey, Head of Real-Time Payments at GHIPSS; Priscilla Hazel, CEO of Nsano and Shaibu Haruna, CEO of MTN Mobile Money Limited. 

Their insights collectively pointed to the urgency of rethinking digital financial strategies to bridge gaps in adoption, particularly among informal businesses and underserved demographics such as women-led enterprises.