Infrastructure deficiencies and adoption of mobile money in Sub-Saharan Africa

•We use survey data conducted in 11 countries in Sub-Saharan Africa in 2011.•We analyze how the availability of physical infrastructure influences adoption of mobile phones and usage of mobile services.•Physical service infrastructure is approximated by data on nighttime light intensity in areas in which survey respondents reside.•Mobile phone users who live in areas with poor infrastructure are more likely to rely on mobile phones to make financial transactions.•Use of mobile financial services is not dependent on level of income.

We use survey data conducted in 11 countries in Sub-Saharan Africa in 2011 to analyze how the availability of physical infrastructure influences adoption of mobile phones and usage of mobile services. The availability of physical service infrastructure is approximated by data on nighttime light intensity in the areas in which survey respondents reside. After controlling for a number of individual and household characteristics including disposable income, we find that adoption of mobile phones is higher in areas with better physical infrastructure. However, mobile phone users who live in areas with poor infrastructure are more likely to rely on mobile phones to make financial transactions than individuals living in areas with better infrastructure. On the other hand, the use of mobile phones to access services such as email, skype, social media networks and Internet browsing is not dependent on the availability of physical infrastructure. Our results support the notion that mobile phones improve the livelihood of individuals residing in remote areas by providing them with access to financial services which are otherwise not available physically.