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Abstract
This study provides a micro perspective on the impact that mobile money services have on an individual’s saving
behavior using 2013 Uganda FinScope data. The results show that although saving through mobile phones is
not a common practice in Uganda, being a registered mobile money user increases the likelihood of saving with
mobile money. Using mobile money to save is more prevalent in urban areas and in the central region than in other
regions. This can be explained by several factors. First, rural dwellers on average tend to have lower incomes and
thus have a lower propensity to save compared with their urban counterparts. Second, poor infrastructure in rural
areas in terms of the lack of electricity and poor telecommunication network coverage may limit the use of mobile
phones and consequently the use of mobile money as a saving mechanism. Overall, the use of mobile money as
a saving mechanism is still very low, which could be partly explained by legal limitations that do not incorporate
mobile finance services into mobile money. The absence of interest payments on mobile money savings may also
act as a disincentive to save through this mechanism. Given the emerging mobile banking services, there is need
to create greater awareness and to enhance synergies between telecoms companies and commercial banks.