On Friday, January 17, 2025 or so, a senior colleague in the Telecommunication industry, Charles Asamoah Assah made a post on LinkedIn which caught my attention to expedite my write-up and share with other digital finance enthusiasts and everyday learners to share their opinions and thoughts on as well.

Just like reading the Holy Bible, it is always better to place what we read in context.

Market Context – Ghana’s Mobile Money Market Continues Upward Momentum in 2024 Ghana’s mobile money ecosystem has sustained its strong growth trajectory into 2024, with key indicators showing significant expansion.

The total volume of e-money transactions has surged to 3.01 billion, marking a substantial increase from 1.92 billion in 2023. The total value of these transactions now stands at GH?8.09 trillion, reflecting a notable rise from GH?6.80 trillion recorded in the previous year.

Registered mobile money customers have grown to 72.98 million, up from 65.58 million in 2023, while active customers have increased to 23.54 million. The number of registered and active agents has also expanded, reaching 882,720 and 406,720, respectively.

Additionally, the balance on float indicating the total funds held in mobile money wallets—has surged to GH?27.19 billion, highlighting the increasing liquidity and trust in the system.

While these figures underscore the rapid expansion of Ghana’s mobile financial ecosystem, the dominance of USSD-based transactions remains a key feature, driven by accessibility across both urban and rural communities.

My field research suggests that despite advancements in digital finance, factors such as network reliability, feature phone usage, and user familiarity continue to reinforce the persistence of USSD as the preferred transaction mode.

Primary Drivers of USSD Adoption
1. Network Reliability and Universal Access. Through experiences shared by some colleagues in implementing payment solutions across Ghana, I’ve found that USSD’s primary advantage lies in its remarkable stability. While working in areas like the Northern Region, Central Region – specifically Cape Coast and Winneba (a place I love dearly) and rural parts of the Ashanti Region, I’ve consistently observed that USSD functions effectively even in areas with basic 2G coverage.

This reliability is crucial for merchants and consumers who cannot afford transaction failures during critical payments. Guess what – even in what we refer to as “the golden triangle” of the country, USSD usage is relatively high.

2. Device Independence and Accessibility. In my interactions with market traders in Kumasi’s Central Market and farmers in the Volta Region, it became clear that USSD’s compatibility with basic feature phones remains a significant advantage. Many Ghanaians own smartphones but also keep basic phones as backups specifically for mobile money transactions and more. You can stand with me in calling it a dual-device strategy (I’ve documented extensively in my field notes) which ensures continuous access to financial services and more.

3. Cost Considerations. The data cost factor cannot be overstated. During my recent survey of small business owners in Accra’s Makola Market, over 75% cited data costs as a primary reason for preferring USSD. When you’re making multiple transactions daily, avoiding data charges can result in significant savings in their opinion.

4. Trust and Familiarity. I refer to this point as Muscle Memory. Through numerous focus group discussions, I’ve conducted across Ghana, I’ve found that users have developed a deep trust in USSD services. Years of reliable service have entrenched USSD codes like *170# (MTN Mobile Money) and *110# ( AT Money and Telecel Cash) in the daily lives of most Ghanaians. This deep trust, coupled with the ease of remembering and using these codes, creates a strong psychological barrier to switching to newer platforms such as smartphone and their application.

5. Transaction Speed. My timing studies comparing USSD transactions versus app-based payments showed that experienced USSD users could complete transactions up to 40% faster than app users, particularly in fast-paced environments like bustling Makola, Agboloshie, Abossey Okai, Winneba One-Way Fish Market, Agobeokai, Kumasi Central market markets…etc, speed is critical. Pretty Simple – why burden myself with an App when I can get the same thing done faster with a USSD? This efficiency resonates with the popular sentiment by a colleague at work: “Why fix it if it’s not broken?”

Challenges and Future Outlook
Despite these advantages, USSD services face certain limitations. Security concerns, particularly around PIN exposure, remain significant. However, in my discussions with some experts, telecommunications colleagues and fintech companies, I’ve learned that rather than replacing USSD, many are working on hybrid solutions that combine USSD’s reliability with enhanced security features.

Market Implications
The persistence of USSD in Ghana offers valuable lessons for financial service providers. Through my consulting work with several entities, I’ve advocated for a multi-channel approach that maintains robust USSD services while gradually introducing enhanced digital solutions.

Recommendations for Service Providers
To sustain and enhance USSD’s relevance, I propose the following:

• Maintain and Upgrade USSD Infrastructure: Invest in ensuring its reliability and security.

• Develop Hybrid Solutions: Combine the simplicity of USSD with the advanced features of apps.

• Address Data Costs: Partner with mobile network operators to reduce and remove data barriers. Let me be BOLD enough to say, make these payments app Data-free.

• Continuously Educate Users: Implement programs to guide users in transitioning to apps at their own pace. You need this deliberate program to “cross the chasm”.

Thinking and Looking Ahead
While smartphone penetration continues to rise in Ghana, USSD’s role in financial inclusion remains crucial. My recent research suggests that USSD will remain a key component of Ghana’s financial infrastructure for the foreseeable future.

The endurance of USSD in Ghana’s digital payment ecosystem is a testament to its practicality and adaptability. It bridges technological divides, supports financial inclusion, and aligns seamlessly with the cultural and economic realities of Ghanaians. As Ghana continues its digital transformation, USSD will remain a cornerstone of its financial infrastructure, a reminder that sometimes, simpler technologies are the most effective solutions.

Note: Having spent significant time in the field studying these patterns and working directly with some stakeholders across Ghana’s financial sector, I believe understanding and embracing this duality is crucial for anyone looking to succeed in Ghana’s digital finance space.

About the Author
Precious Baidoo is a seasoned professional with nearly a decade of experience in Supply Chain Management. He holds a Master’s degree in Procurement and Supply Chain Management and is MCIPS and CMILT certified. He is also a certified Digital Finance Practitioner (CDFP) with a deep interest in digital payments, digital identity, and emerging technologies, Precious blends his expertise with a passion for innovation. A lifelong learner and student of life, He is committed to continuous growth and leveraging knowledge to drive transformative solutions.