Ghana Places 4th in Mobile Phone Penetration, E-commerce Activities to be Strong in Sub-Saharan Africa

Ghana Places 4th in Mobile Phone Penetration, E-commerce Activities to be Strong in Sub-Saharan Africa

Out of 14 sub-Saharan African, SSA, countries, Ghana is fourth in terms of mobile phone penetration. With a percentage of 127.3%, Ghana is beating Africa’s most populous country Nigeria and also Kenya, with mobile phone penetration of 85.5% and 101.8%, respectively.

In an analysis put together by Fitch Solutions, South Africa is the leader with a 173% rate of penetration in SSA. It is followed by Botswana with a 150.6% rate of mobile phone penetration.

In 3rd, 5th, 6th, 7th and 8th places are Gabon (138%), Namibia (113%), Kenya (101.8%) and Zambia (94.8%) respectively. Nigeria (85.5%), Zimbabwe (83.7%), Tanzania (82%) and Mozambique (51.7%) are placed 9th, 10th, 11th and 12th respectively.

Angola and Ethiopia are 13th and 14th, respectively, with penetration rates of 42.2% and 40.4%, respectively. For 3G and 4G subscribers, the penetration rate in Ghana is 53.2% and 5.6%, respectively.

This is compared with 57% and 23.4%, respectively in South Africa. For Botswana and Nigeria, 3G and 4G penetration rates are 54% and 22.5% respectively, and 50.4% and 13.7%, correspondingly.

According to Fitch Solutions, the e-commerce market in Sub-Saharan Africa is relatively underdeveloped as compared to elsewhere in the world, with many households not offering a high enough disposable income level to support the e-commerce market. There are also a number of operational obstacles that have hindered the expansion of e-commerce in SSA.

Payments have proven a barrier to development, as the cash on delivery culture has been deeply rooted in consumers’ behaviour in the Sub-Saharan Africa region.

However, digital payments are picking up, mobile money is slowly becoming a more common method of payments, therefore, Fitch Solutions believes digital payments are becoming less of an obstacle for e-commerce development.

Ecommerce

Lockdowns caused by the coronavirus pandemic to make e-commerce activities strong in the Sub-Saharan Africa region.

E-commerce activities have increased in the region especially during the period where most of the countries were under some type of lockdown. Jumia, the largest e-commerce operator in Africa, witnessed a rise in activities on its platform.

“More sellers are keen to embrace e-commerce and join Jumia because offline distribution channels have been disrupted,” Jumia’s Chief Executive Officer, Sacha Poignonnec said.

In the report, Fitch Solutions said: “We believe that COVID-19 related lockdowns and stay at home orders will necessitate the process of ordering goods and services online, making consumers more comfortable with the process, which will extend beyond the period of lockdowns.”

It explained that for “consumer-facing companies, the prohibition of non-essential retail within the bricks and mortar segment will force many firms to shift to expand or break into the e-commerce sector, with this segment of retail likely to be the main source of revenue for many retailers over a significant period of 2020.”