Financial Inclusion and Electricity Uptake: Global Evidence and District-Level Mechanisms

Megan Elizabeth Lang and Alpha Ly

No 11492, Policy Research Working Paper Series from The World Bank

Abstract: Even as governments push to build infrastructure to achieve universal access to electricity, demand-side barriers constrain uptake where infrastructure already exists. This paper assess the impact of the quasi-experimental introduction of mobile money on electricity adoption by households. Leveraging a cross-country panel of 180 non-Organisation for Economic Co-operation and Development (OECD) countries, it first employs a heterogeneous difference-in-differences estimator to document a significant and positive association between mobile money introduction and electrification, particularly in rural areas. The global analysis is complemented with a granular district-level analysis of 33 sub-Saharan African countries. The district-level analysis leverages differential sub-national mobile network coverage in addition to country-level mobile-money adoption. The results indicate that mobile money access improves district-level power uptake by around 24% relative to the similar districts without mobile money access. Supply-side infrastructure expansion is ruled out as the primary driver. Instead, evidence suggests demand-side channels, specifically reduced financial frictions and increased remittances, drive this relationship. The results highlight the enabling role of mobile network coverage and, conversely, the detrimental impact of mobile money taxes on electrification efforts.

Date: 2026-10-28
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