Mobile money usage and performance of women-owned enterprises: Evidence from Kenya

Abstract

The rapid expansion of digital financial services has sparked discussions about their potential to help financially constrained businesses overcome performance challenges. We investigate whether female-owned businesses, which are often more financially constrained than male-owned businesses, could reduce their performance gap by a more extensive use of mobile money. Analysing data pertaining to 317 enterprises in Kenya, drawn from the Enterprise Survey database of the World Bank, the study finds that a more extensive use of mobile money narrows the gendered performance gap for women-owned businesses. Specifically, employing the Oaxaca-Blinder decomposition, we demonstrate that female-owned establishments could reduce the gendered performance differential stemming from obstacles in accessing finance by about 42.5% through a more extensive use of mobile money. Further analysis indicates that access to traditional financial services does not affect the influence of extensive use of mobile money on enterprise performance. The findings underscore the potential of mobile money technology to help female-owned businesses narrow the gendered performance gap.