"Affective Investments": The Politics of Microfinance Tourism

First cohort, IMTFI fellow Anke Schwittay recently published a new book titled New Media and International Development: Representation and Affect in Microfinance (Routledge 2014). Research for this book began in 2009 with an IMTFI grant awarded to her and Paul Braund to study the digital lending network emerging around Kiva.org, a person-to-person microlending website founded in San Francisco in 2005. In this post, Anke reflects on the process of writing the book, and how it grew out of her IMTFI research.

The IMTFI grant enabled field research in Mexico and Indonesia, allowing us to study how the virtual network of Kiva is grounded in particular localities. We learned about the ways in which Kiva recruits its partner organizations and manages technological infrastructures and financial flows with microfinance institutions (MFIs). We also studied how the MFIs themselves deal with the requirements of being a Kiva partner, especially around borrower selection and verification, and the role that Kiva Fellows play in facilitating this process.

During a visit to the offices of Kiva’s Indonesian partner, MFI, I noticed a poster showing photos of a group of tourists sitting in meetings with borrowers, but also riding through the countryside in Jeeps and snorkling in sparkling blue waters. Intrigued, I asked one of the MFI staff about the poster, and he explained to me that his organization regularly hosted small groups of tourists, mainly from Germany and New Zealand, who come to combine learning about how microfinance works on the ground with more typical holiday adventures. This conversation was the beginning of my interest in the way in which everyday people in the Global North learn about microfinance, which eventually became the central focus of the book.

During the course of researching the book, I visited Chennai, India as a participant in a micro finance tour, I conducted interviews with Kiva borrowers and Fellows, and analysed the Kiva website, blogs and photos. I realized that the representation of microfinance has much to do with the ways in which it remains popular among Northern publics, even in the face of increasing academic and journalistic critique. These representations materialize in prototypical images of smiling women, often in traditional clothes in their places of work, and in what I call ‘microfinance’s obligatory success stories’ of poor women enterprising themselves out of poverty and often work on an affective level. 

This has lead me to analyse the connections established by sites like Kiva as ‘affective investments,’ which are financial, social and emotional commitments to distant others. The book traces these investments from more mediated ones established through a CGAP photo competition and the Kiva website to personal encounters through microfinance tourism and volunteering as a Kiva Fellow.

I also ask if these affective investments enable a more critical engagement with microfinance that is necessary in order for Northern publics to learn about its negative aspects. This is especially important because these publics are usually only treated to anecdotal and highly photogenic stories of success that do not engage the questionable impact of microfinance, its complex gender dynamics or its links to neoliberalism that have been exacerbated with commercialization. I conclude that while personal encounters as tourists and volunteers do open up possibilities for more critical engagement, these are usually foreclosed by the scripted nature of microfinance encounters and by the pressure from microfinance organizations at all levels to upkeep its obligatory success story.

Follow this link to read more of Anke Schwittay's work with IMTFI.

Consumer Finance Research: Global Approaches and Methods (Part 2)

By Erin Taylor and Gawain Lynch

Consumers, users, clients, subjects:

Towards people-centric collaborations

Taking the money to the Bank$y
Photo by John Guano

People working in consumer finance who want to share perspectives across different sectors and disciplines face a communication problem: finding a shared language to talk about people and trying to understand their lives. The bad news is that “thought silos” persist and block possibilities for valuable collaborations. The good news is that a great deal of collaborative work is already underway that demonstrates the value of getting past the silos. 

A major obstacle to knowledge sharing is that the language that different sectors of consumer finance use lends the impression that we are trying to achieve different ends. Commercial businesses, such as banks, tend to refer to people as “consumers.” Governments have “citizens.” Product developers and designers more commonly refer to people as “users.” Microfinance has “clients,” and academic researchers usually have “subjects” or perhaps “participants.”

Of course, it makes sense that we use different terms to refer to the people we work with, because we do have specific aims and goals. Selling someone a credit product is clearly not the same thing as running a financial literacy project; launching a mobile money service seems miles away from running a lab experiment on, say, risk-taking behavior.

However, our language differences obscure the fact that we are often trying to answer the same basic question: what drives people to make financial decisions for themselves and their households?

The last few decades has seen a trend that illuminates just how much the different sectors of consumer finance have in common. This is the much-touted shift towards what's known as “client-centricity” or “human-centered design.” Often attributed to Peter Drucker’s work in the 1930s, the aim of this shift is to flip our focus: for example, an NGO may cease to ask “How can we integrate people into our programs?” and instead ask “What are the things that people actually need?” The goal of researchers operating within this framework is to first try to understand the context in which people live and operate, and only then ask what might be lacking.

This isn't just a more humanistic approach. Nor is it just a useful approach to designing better products and services. It also provides a platform for collaborations. Putting people’s understandings of their needs at the center means that we are starting from a common vantage point, making it easier to conceptualize shared projects. And focusing on the problem we are trying to solve, whether it is conceptual, policy, or end user oriented, can help to offset the siloing effects of professional or academic-specific language and framing upon which many projects depend. 

Consider the following example. IMTFI researchers Ndunge Kiiti and Jane Mutinda worked in rural eastern Kenya to investigate the use and impact of mobile money services among twenty-one women’s groups. Their project was part research, part intervention, and part policy work. They needed to respond to the interests of their research participants and the stakeholders who served them as well as collect their own research data. Kiiti and Mutinda invited representatives from each of the twenty-one women’s groups to attend a workshop that included collective discussions, presentations by some of the groups, and discussions with service providers and policy makers. This expanded format also permitted the researchers to share their preliminary findings, gave service providers and policy makers an opportunity to respond to the women’s concerns, and provided an occasion for the women to network. By bringing the women to the front and center of the project, Kiiti and Mutinda were able to unite the concerns of the women, mobile money providers, NGOs, and their own academic work.

Making customer-centricity happen isn’t always easy. CGAP are currently working on a project that explores what it takes to get businesses to shift their focus to customers. When they began collaborating with Janalakshmi Financial Services, one of India’s largest urban microfinance institutions, CGAP discovered that “all its products and processes are set up from the organization’s point of view and not the customers.” CGAP then began to look closely at both the lives of microfinance customers and the organizational culture of Janalakshmi Financial Services. In a workshop aimed at “wearing the customer’s shoes,” staff members were tasked with thinking through whether their products really matched up with their customers’ needs. The final output of the collaboration will be a household map that helps staff profile customers along a far more nuanced range of dimensions, in order to make recommendations for products and services that will better meet their customers’ needs. By focusing on people’s needs and experiences--a concern all three groups had in common--the microfinance agency, their customers, and CGAP were able to identify points of mutual value.

These examples show that knowing how people assess a product’s features is not enough: we also need to find out what those products mean to them emotionally and socially, and how they will be incorporated into the individual's everyday life and social networks. This was precisely what IMTFI researchers Onyima Jude Kenechi and Onugu Charles Uchenna looked at in Nigeria. They investigated how women chose between mobile money and traditional financial services. Many of their respondents reported that they might sign up for mobile money if someone they respected, such as a leader in their church, recommended it to them. This reflects not just the trust people place in their churches, but also the fact that church ministers have often provided loans, acted as guarantors, or offered financial advice. A product's usability may not guarantee its uptake if the social impetus is not there. Conversely, product uptake is not possible without companies to develop the products in the first place. People-centric collaborations therefore matter.

Collaborating across sectors isn’t just something that we should do. It is already happening. Global changes in consumer finance, such as the growth of alternative service providers and an increased focus on the under-served, are making collaborations a matter of necessity. Mobile money operators find that they must team with NGOs to achieve “scale”. Commercial businesses must work with regulators, who have a heightened interest in consumer protection issues since the global financial crisis. And academic disciplines, which have been becoming increasingly specialized over the years, are now finding that new discoveries are increasingly made at the intersections of disciplinary boundaries. As these collaborations become more common and more urgent people-centricity is becoming a necessity rather than simply a fashionable trend.

This post is part of the IMTFI project Consumer Finance Research: Global Approaches and Methods, which seeks ways to build cross-sector and multidisciplinary collaborations in consumer finance. Read Erin's previous post Call to Action.

Two New Videos about Networks and Mobile Money in Western Kenya

By IMTFI researcher Sibel Kusimba

All eyes are on Kenya to understand the success story of mobile money transfer systems here. What factors have made mobile money so widely used and well trusted? What kind of brave new world are all these mobiles and “flying money” creating in East Africa? 

Naima Mobile Money SNA Graph. Naima, a 46 year-old farmer,
is married to Kiingi. Node size indicates centrality.
Relatives are in color, siblings in a common color; friends are in white.  

In 2012 and 2014, IMTFI supported our project on mobile money use in Western Kenya – where rural and peri-urban communities are engaged in subsistence farming, wage labor, and a variety of small-scale entrepreneurial activities.

Our research uses social network analysis to map the social relationships created and revealed through money transfer. In this area, people use money transfer to create networks of reciprocal support with friends, relatives, savings groups, and co-workers.  

Networks are often studied for their presumed benefit to individuals. Personal “networking” is often thought to be one of the development advantages of the mobile phone.  How do networks support individual empowerment? How do they shape a “networked self” (Rainie and Wellman 2012:126)? 

In a video made by Steven McCord and with the support of IMTFI, we explore money transfer networks of families and friends: 

https://www.youtube.com/watch?v=Sywez6yKEbo

In a webinar sponsored by the American Anthropological Association, I expand on this discussion to particular features of money transfer networks, including reciprocity, centrality, and brokerage: 

https://www.youtube.com/watch?v=atbC_eF8jiI

Overall, this research found that a highly instrumental view of networks as personal empowerment doesn’t fit for Western Kenya. In this area, at least, we found that mobile money use is better seen as an amplifier (Toyama 2011) of economic and social practices of reciprocity, friendship, belonging, and obligation. For example, people often create networks with siblings, pooling resources to help a parent, pay school fees for nieces and nephews, or make an investment. The close, life-long relationships of siblings in East African families are well-documented by anthropologists. 

Based on our study, we developed an alternative view of money transfer—not as personal “networking” but as participating in a group. This mindset of the group plays important roles in how money transfer is used. The network graphs show that reciprocity creates dense networks of sharing that spread benefits across the group rather than to specific individuals.
   

Mobile money provides another example of the paradox of technological change: however “new” a technology is, people’s intentions with it will probably adjust much more slowly, if at all. As Conrad Kottack (1999:34) put it, “People usually change just enough to keep what they have.”   

References:

Kottack, Conrad. 1999. The New Ecological Anthropology. American Anthropologist 101:23-35.

Toyama, Kentaro. 2011. Myths of Technology for International Development.  Lecture at the University of Pennsylvania, October 19. https://www.youtube.com/watch?v=6Kx-KFEzlbk

Rainie, L., and Wellman, B. 2012. Networked: The New Social Operating System. Cambridge, MA: MIT Press. 

Credit Cards, Social Relations, and Serresian Parasites in Chile

IMTFI fellow José Ossandón reports on how the use of credit cards is intertwined with complex social relations in Chile in a case study for IMTFI's Working Paper Series. Drawing upon Michel Serres's notion of "the parasite," Ossandón examines how low-income credit card customers in Chile use their "hidden" social networks to extend credit limits beyond those designed by the credit card companies. By lending cards to relatives and friends, Chileans leverage their existing social networks in complex and surprising ways, demonstrating how financial technologies are always already embedded in intricate interpersonal relations.

Read the full report here.

Understanding the transformative value of Tongan women’s kau tou lālanga: mobile mats, mobile phones, and money transfer agents

By IMTFI researcher Charmaine 'Ilaiu Talei

A kau tou lālanga  in Kāmeli, Neiafu Vava’u,
Tonga. Photo: C. ‘Ilaiu Taleidd caption

Kau tou lālanga is a group of Tongan women who collectively weave one another’s fine pandanus mats to barter and sell. Their prime customers are Tongan women living in diasporic communities around the Pacific Rim. Our research has determined two business negotiations of kau tou lālanga: firstly, to weave per lineal foot, also known as ‘iate, and secondly, to weave towards a ‘gathering’, or kātoanga. An ‘iate negotiation starts with a customer, usually a local person, making an order to a collective to weave one or two mats—only a small quantity. The second negotiation, kātoanga, is a gathering between a number of weavers from a collective and a group of customers, who are mostly Tongan women from overseas. Before a kātoanga, the parties involved negotiate the large number of mats to be exchanged, the sum of cash for the order, and the date and venue of their gathering is also agreed upon. Kātoanga agreements reach higher annual returns than ‘iate negotiations.

Tongan mats, or fala, are part of a wider system of customary gift exchanges within Tongan society. In this customary sense, Tongan mats are cashless forms of value storage. Such value is traditionally activated during a Tongan occasion, such as funerals, weddings and birthdays. A traditional gift from guests to hosts or vice versa could consist of tapa cloth and several types of fine mats. Thus, fine mats—the products of kau tou lālanga businesses—are highly prized items in Tongan material culture. For this reason, this work is part of a wider discussion of gifts of exchange studied by anthropologists: Adrienne Kaeppler (1999), Phyllis Herda (1999), Ping-Ann Addo and Niko Besnier (2008), and Fanny Wonu Veys (2009). However, their analyses exceed the purposes of this blog.

A participant displaying her mats (fala hinehina)
for a kātoanga with her United States of America
based Tongan customer, Tongatapu, Tonga.
Photo: C. ‘Ilaiu Talei

The Kingdom of Tonga is located in the South Pacific (20 00 S, 175 00 W) and is an archipelago of 169 islands stretched throughout 747 square kilometres. The main central island is Tongatapu, where the capital Nuku’alofa is located. Three fieldwork trips were conducted within the project timeframe. A total of eight weeks in two remote islands groups: Vava’u and Ha’apai. Being remote islands they generally have less access to a wider range of cash making opportunities in comparison to the main island. Vava’u and Ha’apai are also mat making epicenters. The fieldwork sites in Vava’u include the rural village of Leimatu’a and Kameli in Neiafu town. In Ha’apai, the sites include the rural villages of Fangale’ounga on Foa Island and Pukotala on Ha’ano Island, and finally, the urban village of Pangai. These village sites were selected based on existing contacts and referrals of where to best find kau tou lālanga groups. A total of 24 participants were interviewed over the course of three trips, 14 from Vava’u and 10 from Ha’apai. Some 20 were sole weavers and all were women and 4 acted as trading agents, of which 2 were men. 

The first objective of this research was to understand what is the transformative value of kau tou lālanga in Tonga and secondly how mobile phones and money transfer platforms help to achieve this transformation. The transformative value was first defined by the authors at the project’s conception as, ‘the potential to move away from an uncontrollable financial situation to a position where one can manage financial challenges with confidence’. The findings have refined and elaborated on this statement.

The first survey investigated (a) motivations for joining a kau tou lālanga (b) understanding one’s financial role in their family and (c) what one spends their profits or wages on, the survey attempted to shape an initial understanding about the transformative value of kau tou lālanga. Preliminary findings show that paying childrens’ education fees, maintaining one’s home through utility bills, feeding dependents and donations to church offerings and supporting village fundraisers are reasons why participants weave and join kau tou lālanga. The three top reasons ranked in order are (1) to pay household utility bills, (2) to pay childrens’ education, and (3) to make church donations. 

It became clear after the first survey that the original definition was limiting the emotional motivations of the weavers. For this reason, the interviews of the second fieldtrip included asking weavers why they chose to do this business and in other words what value they see in this kau tou lālanga? Their responses certainly highlighted that it is not about creating a huge savings account but instead creating a sense of personal satisfaction when one has met the needs of their families. The outcome of providing therefore embeds value into what they do as weavers.  

Our final fieldtrip allowed us to present back a summary of their responses. They were asked to vote yes or no if they agreed with this statement as accurately describing transformative value of kau tou lālanga and why they choose this business. All the weavers present at all presentations answered in confidence ‘yes’ to this statement of transformation. Translated into English:

The transformative value of this business for you as a weaver is not about receiving money to spend or save, but being enabled to financially satisfy the needs of your family, at the time of need and every time of need. Importantly, it is from this position that you gain emotional and mental confidence. It is for this significant reason why you choose to weave and partake in the business of mats.

Moreover, this study broadens our focus on transformations that take place because of the business of kau tou lālanga, such as socio-cultural changes in the role of female weavers in their families. Traditionally, mats have been considered the woman’s domain in Tongan society and it was shameful for a man to dabble in women’s work. Evidently, the financial appeal of the business has normalized the dual-gendered activity of making mats and has helped to remove the male shame of helping, especially when many hands do make the work easier. Undoubtedly, kau tou lālanga is changing the female weaver’s role and consequently others in her family and within the wider Tongan society.

In answering the second objective of this project, the findings reveal that there is a technology knowledge gap for older members of collectives, who are also the leaders and decision-makers in the group. This gap delays business innovations like mobile money and the use of banking applications to facilitate transactions. The very establishment of kātoanga negotiations stresses that weavers and customers alike still prefer to transact face-to-face, so customers can thoroughly check mats before closing a deal and weavers can count their money before releasing the mats. In this way money transfer agencies have not displaced the practice of kātoanga, which explains why money exchange platforms were less important for some collectives and less used by such weavers than what was first assumed. 

The transformative value of kau tou lālanga has been an invaluable investigation because now we can begin to understand the ‘livelihood’ of Tongan weavers; revealing how kau tou lālanga affects the weavers and their dependents but also how weavers shape this business to achieve their customary and financial goals. 

Please click here to see the final report. 

The Thirteenth Cow: Closing Conversations at the IMTFI Sixth Annual Conference

In closing out the public portion of the annual IMTFI conference, Scott Mainwaring reminded participants about all of the work of unpacking the global and the local and interpreting intertwined tangled histories and the challenges to adoption when there are mixtures of devices, which might even include a lockbox with satellite device attached among the ensembles of different technologies.  He also drew attention to the fact that even without smart phones, people in developing countries were doing "amazing work" managing their finances with "just a few alphabetic lines of text."  Now that smart phones with "high resolution beautiful color displays" were on the horizon, the devices were opening up possibilities for more literacy training with "engaging media forms."

Ph.D. candidate Taylor Nelms noted the range of missions and agendas addressed at the conference, including how institutional instability, turnover of officials, and how state offices play into "lines of contestations" that involve everyday practices of the government and different histories of the state in different places to different degrees of heterogeneity.  As the author of Virtualpolitik, a book about the state as both regulator and digital content-creator, I appreciated his emphasizing that the state never functions as a "singular monolithic or homogenous actor," because it has a "range of missions and agendas," as well as his praise for the "fine-grained detail about the state" in many presentations.   He also noted how risk and liquidity may be a function of "the tools we use" and that savings is not one thing, particularly as it involves material infrastructures. As an example, he pointed to the metal box in the collection shown by Ellen Feingold, Curator of the National Numismatic Collection at the Smithsonian, which could not be opened without being torn apart by metal shears.

Caroline Schuster, a previous IMTFI grant recipient, who is now a lecturer at Australian National University) marveled at how rapidly work on mobile money had developed in a comparatively short time and how being "durable and instituted" practices as a "matured" practice.  In particular she claimed that the research questions around access had fundamentally changed, as well as issues about privacy and secrecy.  Like many closing commentators, she cited the work on "the thirteenth cow" presented on the first day on the opening panel about tradition.  To movie goers, she also recommended the Paraguayan film 7 Cajas (7 boxes) to show the complexity of financial interrelationships.  To find out more, you can watch a trailer for 7 Cajas here,

Mrinalini Tankha, an IMTFI postdoc, also reminisced about being part of the first generation of researchers.  But she asserted that -- despite the changing language of research -- the constant of considering trust continues to be "fundamental and contentious in any social organization."  According to Tankha, inequalities of power obviously exacerbate distrust.  She also warned that excessive trust among researchers in seemingly authoritative products, services, institutions, and scholarship could undermine research, and she gave a plug for the closed-door workshops on methodology to follow.

In taking the microphone, organizer Bill Maurer lauded the "six year long conversation" that had begun with a handful of people and had now grown to including 140 researchers in 43 different countries.  In praising this "long conversation," he described the ongoing and continuing revision of hypotheses and how no one was compelled to "tow one line."  As researchers try to understand the "contingent composition" at the heart of various resources, they mirror similarly a "constantly emerging network" that is a "community of inquiry" coming together "with a generosity of inquiry and spirt."

A discussion about collaboration with the financial sector was initiated by Amol Jadhav (GSMA) about working with industry and managing the "balancing act" between on the one hand merely providing opportunistic "market research" and on the other hand generating work that only "exists in paper" and is thus less valuable to the public.  When Maurer turned the question to IMTFI researchers, it was a lively set of responses.  Ana Echeverry of Inspira Lab bemoaned the fact that it was "extremely difficult when you are no one" to have "anything actionable reach those influencers."  She critiqued financial central planners who were "always in Europe" and the impossibility of reaching power brokers like Carlos Slim.  Vivian Dzokoto indicated her enthusiasm for collaboration but acknowledged barriers to uptake and hesitance toward independent perspectives.   Sosthenes Kewe, Technical Director of Financial Sector Deepening Trust, who sat with Johnson Nyella, economist from the Central Bank of Tanzania considered this conversation valuable to "build capacity."  Kewe wanted to hear more about collaborating researchers focusing the design of financial services.  He also encouraged researchers to hold more IMTFI conferences in Africa.  Such venues could have a leveling effect, as in the case of a recent conference in Ghana, which allowed participating market women to challenge the assertions of regulators.   Maurer said that UC Irvine, potential African university hosts, and other forums "defined by academic settings" demonstrate how "the university and academia can provide a neutral space" in which "identities of participants" can be "kept confidential" and "issues of competition" could be ameliorated.

I'll sign off myself as well with this entry for a while.  I've posted a very abbreviated explanation of what has drawn me to this place as a blogger for a number of years, and I hope to be posting some more new stories before this group assembles again.

IMTFI featured on Digital Media and Learning Blog

IMTFI resident blogger, Liz Losh, has been super-busy over the holiday break providing in-depth and fascinating summaries of the findings presented at both days of our annual conference. Her work is reaching a wide audience across the twittersphere under the handle @lizlosh and she has posted about the conference on the Digital Media and Learning Blog. It is well worth a read!

"The fact that a cellular telephone can transmit the value of a particular currency from one party to another may be increasingly obvious, given the rise of specialized digital money services in the United States, such as Square or Apple Pay. Around the world, mobile money does much more than signal access to disposable income or brand name consumer electronics; it can quite literally ensure survival for people on the bottom of the economic pyramid..."