1 / 29

Experimenting with mobile money

Experimenting with mobile money. William Jack Georgetown University Based on research with Alev Gurbuz , James Habyarimana and Tavneet Suri. Africa Growth Forum, 2015 UNCC, Addis Ababa, Ethiopia. The solution:. The problem:. Customer and Agent growth. 2011. 2009. 2010. Agents.

meganh
Download Presentation

Experimenting with mobile money

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Experimenting with mobile money William Jack Georgetown University Based on research with AlevGurbuz, James Habyarimanaand TavneetSuri Africa Growth Forum, 2015 UNCC, Addis Ababa, Ethiopia

  2. The solution: The problem:

  3. Customer and Agent growth 2011 2009 2010 Agents Customers Customers 2008 Agents 2007

  4. Visualizing financial inclusion (Gurbuz) Excluded Informal Formal

  5. Financial inclusion in Kenya: 2009

  6. Financial inclusion in Kenya: 2013

  7. M-PESA as a risk spreading tool (Suri) • Four-year panel survey of 3,000 households, 2007-2010 • Negative shocks reduce consumption by about 7% - 10% • But M-PESA users see no fall in consumption • That is, M-PESA users are fully insured

  8. Long run effects of M-PESA (Suri) • Can M-PESA change the level of consumption, not just it’s variance? • Possible impacts on: • Occupational choice: farming  business? • Migration: seasonal or permanent? • Use a long-run follow up survey of our sample in 2014 to assess these impacts

  9. Mobile financial services • Savings • Credit • Subsidies

  10. Savings: High Hopes(Habyarimana) • How can savings be boosted? • Increase salience of saving • Provide information about future costs • Reduce transaction costs • Mobile Money savings account • Reduce temptation • Commitment Savings Account • Increase awareness • Regular text reminders

  11. Mobile savings solutions Lock Savings Account Interest bearing mobile money bank account Mobile money transfer service • Additional 1% interest • 1-6 month maturity • Goal set • Early withdraws: • Lose bonus interest • 48 hour waiting period • 1-5% interest • Loan facility

  12. Context of our study • Three counties in Kenya • Kisumu, Nyeri, Kilifi • Geographic, ethnic, and linguistic diversity • Target parents of final year primary school students • Six month window ahead of transition to high school

  13. Design: school-based randomization • All groups received information on the importance of saving for high school

  14. Sampling and randomization Kisumu Nyeri Kilifi 3 Counties • 3 x 120 school meetings • 13 without Std 8 • 2 refused • 7 with no parents 338 x ~14 parents

  15. School meeting • Introduction to High Hopes and consent • Parental engagement • Importance of high school • Thinking about the costs of high school • Encouragement to save • 15 minute baseline survey • Treatment administration • Members of T1 and T2 assisted in opening accounts if desired • T2 invited to convert maturity to January 5, 2015

  16. Timeline Primary school exams end High school starts { { Endline school-based interviews n = 3,215 Endline invitation letters sent Lock boxes mature Jan 5, 2015 Baseline and recruitment n = 4,713 Endline invitation calls and SMSs Endline phone interviews n= 934 Re-contact rate: 88%

  17. Baseline summary

  18. M-Shwari take-up Post- Post- Post- Pre- Pre- Pre-

  19. M-Shwari opening dates Control Treatment 2 Treatment 1

  20. LSA take-up Post-

  21. LSA Maturity Dates January 5, 2015 Control Treatment 2 Treatment 1

  22. Results Stay tuned

  23. Credit (Suri) • Sustainable credit requires screening of bad risks • But group-based lending and high deposits can choke off demand • Asset collateralization is rare – especially for small, easy to hide, assets

  24. Mobile credit:making credible the threat of repossession dis • Small solar power units purchased on credit • Cost: $75 • Down-payment: $5 • Repayment via mobile money • Remote penalties and shut-off both feasible

  25. Design Sample: 1,850 small retailers Ex ante assignment Control I. PAYG II. Weekly repayments Ex post assignment II(a). Full enforcement II(b). No penalty III(c). No enforcement

  26. Take-up

  27. Results • Penalties increase repayment somewhat • Even with complete lack of enforcement, many people still repay • Reputations important? • Kerosene use falls – health benefits

  28. Subsidies delivered over the mobile network • Maternal health care vouchers and transfers (both conditional and unconditional) • Implemented in rural western Kenya • Meaningful impacts on assisted deliveries • CCTs just as effective as maternal vouchers

  29. www.gui2de.org

More Related