Interoperability Between Mobile Money Agents and Choice of Network Operators: The Case of Tanzania

Lukasz Grzybowski, Lindlacher Valentin () and Mothobi Onkokame ()
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Lindlacher Valentin: TU Dresden, Ifo Institute Munich & CESifo, Helmholtzstr. 10, 01069 Dresden, Germany
Mothobi Onkokame: School of Governance, University of Witwatersrand, 2 St Davids PI, Parktown, Johannesburg, South Africa

Review of Network Economics, 2023, vol. 22, issue 1, 27-52

Abstract: In this paper, we investigate the effects of non-exclusive agreements between networks of mobile money agents on mobile network operator choices, using survey data from Tanzania conducted in 2017. By combining survey responses with geo-location data and information on agent proximity, we employ discrete choice models to analyze consumers’ decisions in subscribing to mobile network operators and their corresponding mobile money providers. Our findings highlight the significant influence of the distance to mobile money agents on consumers’ subscription choices. To explore the impact of interoperability (non-exclusivity) at the mobile money agent level, where consumers can use the nearest agent from any mobile money provider, we assess its effects on market shares of mobile network operators. Our results indicate that interoperability at the agent level has only a minor impact on market shares. Smaller operators experience marginal gains as their consumers can now utilize agents of larger providers, which are often closer in proximity. In conclusion, we find that interoperability at the agent level does not considerably alter the market structure in the context Tanzania during the period under consideration.

Keywords: mobile money, interoperability; M-Pesa; Tanzania; mobile networks (search for similar items in EconPapers)
JEL-codes: L86 L96 O16 O18 O33 (search for similar items in EconPapers)
Date: 2023
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Working Paper: Interoperability between mobile money agents and choice of network operators: the case of Tanzania (2024)
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DOI: 10.1515/rne-2023-0024

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