Mobile payment solutions have emerged as a significant technological innovation in modernizing financial transactions, particularly for small traders operating in informal markets. A mixed-methods approach was employed, combining qualitative interviews with quantitative data analysis from a sample of 100 small retail businesses in Mozambique. Data collection included questionnaires assessing current financial practices and semi-structured interviews to gather insights on mobile payment experiences. Mobile payments led to an average reduction of 25% in transaction costs, primarily due to the elimination of cash handling expenses and faster processing times compared to traditional methods. The analysis indicates that mobile payment solutions can significantly reduce transaction costs for small traders in Mozambique, fostering a more efficient and scalable business environment. This reduction in costs is expected to translate into increased revenue and operational efficiency. Policy makers should incentivize the adoption of mobile payments by small traders through subsidies or tax breaks, alongside enhancing digital literacy programmes to support small businesses in effectively utilising these solutions.
Mulenga et al. (2005) studied this question.