Early adopters of technology

Africa can leverage its high mobile telephony penetration and digital adoption to tackle a foundational challenge to improved provision of social protection: enrollment. Statistics related to mobile technology access for Africa positively contrast the above poor statistics of pension coverage.

• There are eight times more unique mobile subscribers in sub-Saharan Africa than active pension contributors in Africa.
• There are five times more mobile internet users in sub-Saharan Africa than active pension contributors in Africa.

Pension system reform and future investments by pension funds should prioritise and enable the acceleration of Africa’s digital transformation. The current reality for Africa’s pension policy and frameworks is that the majority of economic activity and income occurs in what is referred to as the “informal economy”. Future contributions will come from individuals working in the informal economy, with the cohort of these youthful contributors set to increase. Pensions and savings will increasingly need relevance and congruence with mobile application ecosystems. Apps are part of everyday life, with super-apps in ascendance. Super-apps are aggregators of other applications that provide the user with an integrated interface.

Nigeria and Tanzania can serve as essential litmus tests for other African countries contemplating innovative accelerated enrollment of new contributors into the national pensions and savings ecosystem. These countries have licensed their Mobile Network Operators (MNOs) to act as the Identification (ID) enrollment partners of their respective governments. These governments are “piggybacking” off the pre-existing and expanding presence of MNOs within their respective countries to accelerate citizen enrollment onto their national digital ID platform. Without downplaying valid concerns around data privacy, the partnership between governments and MNOs presents a unique opportunity for accelerated delivery of services, financial inclusion, healthcare benefits and social security provision. The provision of digital IDs is an African imperative, with a number of the continent’s governments implementing this in line with the African Union’s Digital Transformation Strategy. The strategy recognises the importance of an integrated and inclusive digital society and economy in Africa and identifies inclusive and trusted digital ID systems as a crucial component of this vision. The AU recognises that digital ID systems must be designed to empower people, especially disadvantaged and marginalised populations.

The Covid-19 pandemic reinforced the critical importance of the mobile sector in Africa, serving as an essential lifeline that not only kept the continent connected but also learning, working and economically active by facilitating trade and transactions via mobile money wallets and cloud-supported payment systems. The intersection offered by mobile phone access and rapid digital adoption necessitates accelerated and prioritised creation of digital platforms that can help bridge the pensions coverage gap. Digital platforms represent a digital-centric future for Africa, with mobile telephony at the centre of innovation, consumption and financial service provision and deepening.