A closer look
A digital wallet stuffed with thousands of shillings means absolutely nothing if the village kiosk owner only accepts paper. Mobile money liquidity traps happen in developing regions where digital infrastructure outpaces physical banking logistics. While users can text funds instantly, extracting that money relies on a network of small human agents holding actual cash. When harvest seasons or holidays hit, the physical cash dries up instantly, effectively locking digital wealth inside the phones of hungry consumers.
