Welfare Effects of Financial Inclusion Services in Ghana: A Comparative Analysis of Mobile Money and Other Financial Services

The study examines the effects of financial inclusion services—mobile money and other alternative financial service options—on consumption expenditure and poverty status by employing the augmented inverse probability weighted (AIPW) estimator to address selection bias and unobserved heterogeneity in the adoption of these services. Using a nationally representative survey data in Ghana, the results show that adoption of financial inclusion services increases household consumption expenditure and also decreases the probability of being poor. Specifically, the effects are larger for adoption of other alternative financial service options relative to adoption of mobile money services. Estimating the interaction effects shows that there are complementarities between adoption of mobile money and other alternative financial service options. The results also show considerable heterogeneity with effects largely observed in male-headed households compared to female-headed households. The results suggest that adoption of financial inclusion services could serve as welfare improvement strategies in developing countries and draw policy attention to the gendered welfare effects.