Mobile

GSMA reveals Africa's connectivity challenges; 60% usage gap limits growth. (Image source: Adobe Stock)

The GSMA, a global organisation connecting the mobile ecosystem, has released its 'State of Mobile Internet Connectivity 2024 report', revealing that 43% of the global population still do not use mobile internet

Despite consistent annual growth in users, progress has slowed. In 2023, 160 million people started using mobile internet, bringing the total number of users to 4.6 billion, a figure similar to the previous year. However, this marks a slowdown from the 2015-2021 period, when more than 200 million new users were added each year.

According to the report, 350mn people, or 4% of the global population, live in remote areas without access to mobile internet, while 3.1bn people (39%) live within coverage but do not use the service, creating a substantial "usage gap." This gap remains the biggest challenge in expanding internet access.

The GSMA report, funded by the UK Foreign, Commonwealth and Development Office (FCDO) and the Swedish International Development Cooperation Agency (Sida), estimates that getting the unconnected population online could add US$3.5 trillion to the global economy between 2023 and 2030, with most of the benefits impacting low- and middle-income countries (LMICs). However, closing this gap will require an estimated US$418bn in infrastructure investment to achieve universal mobile internet access.

Africa: Least connected region

Only 27% of the region’s population uses mobile internet, leaving a 13% coverage gap and a massive 60% usage gap, indicating that many live within mobile internet coverage areas but do not use the service.

A key obstacle is affordability. In low- and middle-income countries (LMICs), entry-level internet-enabled devices cost around 18% of average monthly income, but in Sub-Saharan Africa, this figure skyrockets to 99% for the poorest 20% of the population. This makes mobile internet devices out of reach for a significant portion of the population.

The usage gap is also fueled by low digital literacy and lack of relevant local content. The report estimates that closing the usage gap in Africa could contribute an estimated US$3.5 trillion to the global economy by 2030, with 90% of that impact benefiting LMICs. However, bridging this gap requires significant investment in infrastructure—around us$418bn is needed to achieve universal mobile internet access.

In addition, nearly two-thirds of mobile internet users in Sub-Saharan Africa still rely on 3G smartphones or feature phones, limiting their ability to fully engage with digital services. The region’s infrastructure must evolve to offer affordable 4G and 5G connectivity, alongside efforts to improve digital skills.

John Giusti, chief regulatory officer at the GSMA, said, “Despite continued progress in expanding the reach of network infrastructure and in increasing mobile internet adoption, significant digital divides remain."

“Although most users access mobile internet daily, their activities are often limited to just one or two activities, even though many express a desire to do more. This highlights persistent barriers to enabling meaningful connectivity, preventing users from getting online and getting the full benefits of the mobile internet."  

Old Mutual Connect launches as a new MVNO on Cell C, enhancing mobile accessibility for South Africa's lower-income market. (Image source: Adobe Stock)

Old Mutual, a South African insurance giant, has introduced a Mobile Virtual Network Operator (MVNO) called Old Mutual Connect on Cell C's platform, coinciding with a surge in the MVNO sector

Clarence Nethengwe, the CEO designate of OM Bank, highlighted that this service is part of the company's Integrated Financial Services (IFS) strategy, aimed at offering tangible value-added services to its customers.

The new service aims to deliver competitive mobile options, targeting improved connectivity for the lower-income market. Nethengwe emphasised the importance of affordable data, stating, “Affordable data and reliable connectivity is critical for our customers in the mass market to fully participate in the mainstream economy. It is also an important enabler for our customers to interact with the rest of our propositions digitally.”

Operating on Cell C’s network, Old Mutual Connect will utilise a multi-operator core network agreement to ensure reliable, high-speed mobile services. This network benefits from existing partnerships with Vodacom and MTN, offering a broad coverage footprint.

Customers can obtain a SIM card for R5 (US$0.29) at any Old Mutual branch, with options to purchase data and airtime available through branches, partners, and digital channels.

In September 2024, Old Mutual announced plans to launch a bank by the first quarter of 2025, with regulatory approval from the Prudential Authority confirming the readiness of its systems. Clarence Nethengwe is set to take on the role of CEO-designate of the bank, effective November 1.

MVNO market growth

South Africa's MVNO market has seen substantial growth recently, with several new players entering over the past five years. MVNOs, which provide cellular services without owning network infrastructure, buy wholesale access from mobile network operators to serve their subscribers. By December 2023, the market had over 4.3 million MVNO SIMs, reflecting a 51% annual growth rate.

The market is projected to expand further, potentially reaching 10 million SIMs by December 2028. The anticipated entry of major retail brands could accelerate growth, possibly driving the total to 13.5 million SIMs. Old Mutual Connect joins other prominent operators like Capitec Connect, South Africa's largest MVNO with over one million active SIMs, and FNB Connect, which had 879,000 active SIMs in 2022 and aims to reach one million soon.

PalmPay launches USSD code in Nigeria, enabling millions to access financial services without internet, enhancing financial inclusion. (Image source: Palmpay)

PalmPay, a prominent financial platform with over 30 million users on its mobile app in Nigeria, has introduced a USSD code service

This new feature provides Nigerians with an alternative way to manage their finances without relying on internet access. By dialing *861# on their mobile phones, PalmPay customers can now perform various banking transactions.

Expanding cashless transactions 

Since launching in 2019 under a Mobile Money Operator license granted by the CBN, PalmPay has offered a range of financial services, including money transfers, bill payments, credit, and savings, all within its comprehensive financial "superapp."

For those without smartphones, PalmPay’s vast network of over 500,000 Mobile Money Agents enables transactions nationwide. The addition of the USSD feature is designed to increase accessibility and convenience for users, especially in a market where internet outages are common.

Chika Nwosu, managing director for Nigeria, reaffirmed the company’s focus on financial inclusion: "At PalmPay, we aim to bridge the gap in digital access, and the introduction of our USSD service aligns with that mission. Our platform ensures seamless connectivity for our users," he stated. He also highlighted the security aspect of the new service, noting that users can freeze their accounts remotely if their phone is lost or stolen, providing enhanced protection for their finances.

PalmPay has made notable strides in Nigeria, amassing over 30 million registered users and connecting 1.1 million businesses through its network of mobile money agents and merchants. The platform has played a pivotal role in driving financial inclusion, with one-third of its users having opened their first-ever financial account through PalmPay.

Recently, PalmPay was named one of the World’s Top 250 Fintech Companies in 2024 by CNBC and Statista.

With a focus on user-friendly interfaces, reliable transactions, and growth through fee-free transfers and promotions, PalmPay continues to strengthen its position as a key player in Nigeria’s fintech landscape.

Vivek Badrinath is the new director general of the GSMA. (Image source: The GSMA)

The GSMA, a global organisation unifying the mobile ecosystem, has appointed Vivek Badrinath as the new director general and member of the GSMA board

Badrinath has held several significant leadership roles throughout his career, experience that will stand him in good stead to perform effectively in his new position. And this history includes extensive engagement with Africa, having previously served as regional CEO of Africa, Middle East and Asia Pacific at Vodafone. Before this, he held key positions at Orange.

The new director general will take over from Mats Granryd, who will step down from the role after MWC Barcelona 2025.

Driving digital change

“I am delighted to announce Vivek Badrinath’s appointment.” said José María Álvarez-Pallete López, chairman of the GSMA. “During our selection process it was clear that Vivek’s deep understanding of the industry and its potential make him the ideal individual to lead the GSMA into the next phase of its evolution. I am confident that Vivek will work, together with the board and our excellent GSMA leadership team, to drive change and innovation, creating value for both the industry and society.”

“I’m proud and honoured to be joining the GSMA at such an exciting time in the industry’s development,” remarked Badrinath. “I look forward to working with the GSMA board, it’s members, and the leadership team to extend and amplify the positive impact of the mobile ecosystem for people, industry and society globally.”