This study aims to analyze the effect of banking technology [automated teller machine (ATM) and mobile cellular devices (MOBs)] and other traditional factors on the level of currency in circulation for a sample of 21 selected sub-Saharan African (SSA) countries. It also assessed the mitigating effect of education on the relationship between banking technology and the cashless economy.
The study used a panel data approach to design a cashless economy model with banking technology – ATM and MOBs – as well as their interaction with education as regressors.
This study finds that MOB is significant for promoting a cashless economy, whereas ATM is insignificant in sample SSA countries. The level of education and the number of bank branches were also found to be significant in promoting a cashless economy. The interaction between education and ATM was insignificant but negatively signed, whereas that between education and MOB was significant but had a positive sign.
Non-availability of data restricted this work to a panel study of selected SSA countries. Subsequent studies should consider single-country case studies.
Findings from the study imply that for banking technology to drive a cashless economy effectively, education has to be improved.
The ratio of cash in circulation to total money supply was used as a measure of the cashless economy. The study also evaluated the moderating effect of education on banking technology.
The authors appreciate the financial support of Covenant University Center for Research, Innovation and Discovery (CUCRID) for the publication of this paper.
Urhie, E., Amonu, O.C., Mbah, C., Ewetan, O.O., Matthew, O.A., Adediran, O., Adesanya, O. and Adekeye, A. (2021), "Banking technology and cashless economy in selected Sub-Saharan African countries: does education matter?", Journal of Money Laundering Control, Vol. 24 No. 3, pp. 584-595. https://doi.org/10.1108/JMLC-10-2020-0122
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