The new normal: The Covid-19 pandemic spurs a long-term shift to e-commerce and digital payments in the local market

E-commerce and digital transactions have expanded rapidly in Ghana, a trend that accelerated during the Covid-19 pandemic as health-related restrictions limited foot traffic in malls, prompting greater levels of online retail activity. A corresponding increase in mobile money payments and transfers was supported by quick interventions by the Bank of Ghana (BoG), the country’s central bank. Efforts to enhance financial inclusion and provide new payment options could support the long-term expansion and maturity of e-commerce as more people adopt cashless payments and shop online.

Lockdown Effect

The pandemic accelerated the expansion of e-commerce during the initial lockdown from late March to April 20, 2020. As much as 79% of retail business was conducted online during that period, according to the e-Commerce Association of Ghana (e-CAG). “While most brick-and-mortar retailers have an online presence, the lockdown period incentivised a number of smaller traders to leverage online marketplaces,” Paul Asinor, executive director of the e-CAG, told OBG. “New stores continue to come online every day.” According to the association, conservative estimates anticipate that the value of the e-commerce market will expand from $481m in 2021 to $674m in 2025, with more than 11m users.

The expansion of e-commerce was reflected in a rise in digital transactions. Digital transactions increased by approximately 120% between February 2020 and February 2021 in response to voluntary and mandated restrictions on movement. By comparison, transactions grew by 44% year-on-year in February 2020. As online payments and digital transactions increased, the pandemic served as a catalyst for the BoG to increase transaction and transfer limits, which supported small and medium-sized enterprises that turned to mobile money instead of physical cash. Mobile money is the most popular and growing channel for electronic payment in the country. Transactions via mobile wallets and phones represent approximately 82% of the country’s GDP, and the value of mobile money transactions stood at $99bn in 2020 – far surpassing cheque and cash transactions, valued at $29bn.


Merchant payment solutions and online payment gateways require mobile money integration, posing a challenge for growth in e-payment solutions, as not every customer has the right device and access to data. In Ghana 47.9% of residents have access to only a basic phone, according to Emergent Payments Africa. This necessitates the use of unstructured supplementary service data (USSD) codes, which allows users without a smartphone or data to use mobile banking. Towards that end, in March 2020 Ghana Interbank Payment and Settlement Systems introduced a universal QR code, and by September of that year six banks had implemented the technology that allowed customers to pay for goods and services by scanning the codes.

The harmonised QR system, called GhQR, enables payments on any platform, and from sources such as mobile money wallets, cards and bank accounts held by payment service providers and banks across the country. Merchants are able to receive payments instantly via static or dynamic QR codes, while unique identifiers assigned to their point of sale facilitate receipts by USSD. The system leverages the country’s high mobile penetration rate and allows small merchants to receive payments from anyone, including customers without smartphones or bank accounts.

To further digital payments, in line with the government’s “cash-lite” agenda, in August 2020 the BoG announced it would pilot a central bank digital currency (CBDB). The e-Cedi is intended as to serve as an alternative to physical cash. In addition to supporting financial digitisation, the CBDC could enhance payment system competition, and reduce costs associated with issuing and managing physical cash. Once fully launched, the e-Cedi could play a key role in improving financial inclusion, particularly in remote or rural areas where infrastructure for distributing cash may not be available.