The influence of the mobile money payment on the performance of small and medium enterprises in Somalia

Abstract

This study examines the influence of mobile money payment on the performance of small and medium enterprises in Somalia. A cross-sectional research design is used to explore the relationship between mobile money and business growth. Cross-sectional data collected from sample 385 business enterprises in Somalia was studied while descriptive and analytical methods were used to analyze the data. The Generalized Linear Model was employed to estimate the association between the variables of interest.This study found that mobile money promotes business growth, and 1 % increase in mobile money usage leads to about 11.14 % of business growth. The findings of this study indicate that mobile money services boost the performance of small and medium-sized enterprises by increasing access to finance, boosting sales growth, financing product development, and reducing operational risk. Mobile money services also help small and medium enterprises reduce knowledge asymmetries, eliminate market inefficiencies, and improve decision-making, ultimately contributing to enterprise performance.The findings of this study imply that the expansion of mobile money services can significantly benefit small and medium-sized businesses in Somalia; hence, the government and mobile service providers should promote a safe and effective mobile money system that prevents fraudulent transactions.