Monday, June 17, 2013

"My credit history": new monetary practices among Altaians in the post-Soviet era.

IMTFI researcher Svetlana Tyukhteneva gives us an update on her work on loans in the Altai Republic. More on the project.

Bank credit for private individuals among the Altaian community (Altai Republic, Russia) has only become publicly available in the post-Soviet period. Cash loans have now become an integral part of the lives of modern Altaians and people get them a number of different ways. The main objective of this project is to investigate the practices of new money among Altaians, particularly bank loans and bank credit cards. 15 interviews were carried out from July to September 2012 in the Ongudaisky district of the Altai Republic. The population of the area is 14,513 people and 76% are Altai. Respondents were chosen from among those who used the services of banks that were lending cash. The research confirmed my hypothesis, that monetary behavior among Altaians is culturally conditioned. Living in the same environmental conditions, yielding approximately the same salary, buying food and clothing in the same stores, Russian and Altaians handle money differently.

INSTANT MONEY. Cash loans: here and now!

Results of the project after six months:
1. Bank loans became available for the bulk of working citizens of the Altai Republic in 2002. Access to credit depends on the policy of each individual bank but generally as more people take loans, they are being made more and more available. Paying them is more difficult. To take a loan you must give the bank a wage slip from an official source. Since 2012, representatives of lending institutions have begun to go into people’s work places to offer loans and potential borrowers can complete an application for a loan whilst at work.

2. After working with borrowers I have found that they can be divided fairly evenly between two groups: those people who have had a positive experience and those who have had problems. I use this division as a methodological framework. Those that have had a positive experience can be further divided into those that will borrow more cash in the future and those that won't.

3. Looking more closely at the vocabulary employed by Altaians with regard to transactions, I was immediately drawn to how expressive they were about loans. One respondent said that he "loves loans" while another person compared loans with hard-labor. Based on this, we can assume that the credit history of each of these individuals is emotionally charged and is on a par with other important aspects of people's lives.

4. The stories I gathered from respondents confirmed my idea that bank loans and credit cards are the Altaians' first "school of capitalism," the first step on the road to capitalism. Quite a lot of the people who had taken a loan with cash at least once noted that due to the loan they had begun to learn to count money and plan expenses.

5. It is worth looking at some of the purposes for which the borrowers use credit money. Among other things they are used to purchase and repair houses, buy a car, host a wedding, purchase furniture and appliances, purchase livestock and livestock feed, pay for funeral expenses and purchase expensive clothing (coats of fur). These observations and conclusions are important for my further studies. My idea is as follows: cash loans have taught borrowers to be better at financial planning, more rational and pragmatic and with more financial discipline. I would like to look more closely at Altaians representations of wealth and poverty through the anthropology of money.

6. Many respondents stated that they took loans for the purchase of furniture, home appliances, mobile phones and expensive clothes like coats of mink because they have a desire to "have it all." People still refer to the trademark "hunger" of Soviet times. According to many social scientists and economists the Soviet ideal of wealth in the form of the triad "apartment, car, house" exists in the Russian mass consciousness to this day. Consequently, most of the borrowers take loans in cash or as a mortgage to improve the quality of their lives, rationally investing in their own future and the future of their children. However, there are also those borrowers who take a loan but use it inefficiently, spending in order to satisfy transient needs.

ALTAIENERGOBANK: "Fast, cheap, available!"
Most of the population of the Altai Republic can be classified as low-income families. Respondents explained that low-wages, unemployment and the absence of additional sources of income leads people to borrow money. The emergence of new players in the Russian banking market and the tightening of state control over the activities of banks has meant that the credit policy of banks has become more flexible. But the ease of getting credit in cash, the rather aggressive advertising of consumer credit organizations, and the economic illiteracy of the population, are all factors which can mislead people. People who do not carefully read the loan agreement, especially paragraphs typed in small print, only learn about hidden interest payments when they discover that their principal amount has remained high despite them having met the mortgage payments as required. As a result there are some people who find that they cannot repay the loan. Despite their best efforts to improve their lives, the loan ends up reducing their quality of life. On the flip side, there are a number of positive examples: loans for farm equipment have helped bring many people in villages in the Ongudai region out of poverty.

Thursday, June 6, 2013

IMTFI Researchers Report on Findings from Workshop on "Landscaping Mobile Social Media and Mobile Payments in Indonesia"

Tom Boellstorff and his team offer here a series of reflections on the research resulting from their project on mobile technology, social media, and payments in Indonesia." This report, which precedes the project's final report, draws on insights emerging from the workshop “Landscaping Mobile Social Media and Mobile Payments in Indonesia,” which took place in Surabaya, Indonesia, on September 28 and 29, 2012.  

Image from a shopping mall in Surabaya. Photo credit: Tom Boellstorff

Key insights, about which the team is currently completing additional research, include the following:

1) The dominance of BlackBerry
2) The importance of providers and websites  
3) Place and time
4) Risk and reward 

Click here for full summary of insights emerging from the workshop “Landscaping Mobile Social Media and Mobile Payments in Indonesia,” which took place in Surabaya, Indonesia, on September 28 and 29, 2012.

Click here for the previous Interim Report by Tom Boellstorff and IMTFI Director Bill Maurer, published October 31, 2012.

Tom Boellstorff is Professor of Anthropology at the University of California, Irvine. His research interests include contemporary Indonesian society (where he has conducted ethnographic research since 1992) and digital culture. His books, among others, include Coming of Age in Second Life: An Anthropologist Explores the Virtually Human (2008) and with Bonnie Nardi, Celia Pearce, and T.L. Taylor, Ethnography and Virtual Worlds: a Handbook of Method (2012).

Monday, June 3, 2013

Barriers to mobile money adoption among rickshaw pullers in Delhi: The first of two personal stories

IMTFI sponsored researcher Mani Nandhi highlights barriers to mobile money adoption among rickshaw pullers in Delhi by sharing her notes from the field in the first of two personal stories.

I would personally like to see all of the un-banked rickshaw pullers in Delhi be able to deposit their savings safely via a mobile phone into a bank account. Is this wishful thinking? Do these poor migrant pullers have the same desire as I do in finding a safe place to save? Are there factors beyond their control or my vision that comes between desire and effort? The following is the first in a two-part blog post looking at my encounters with two rickshaw pullers in Delhi. In the process of trying to unravel the main issues I pay particular attention to the way poor people's desire and choices can inform us about context and culturally specific barriers to mobile money adoption.

Tulsi Ram guessed that he is about 55- 57 years old. He is an uneducated rickshaw puller who migrated from Madhya Pradesh to Delhi with his wife and five sons, 12 years ago. Within a day of our meeting him, he was interested in acquiring a bank account. He explained that up until then he had not been able to get one because he had no savings. Softly-spoken but determined that he should think of saving for his twilight years, he volunteered with us to get a mobile bank account. It was a real achievement for him when, after using his thumb print on the application form, he received the EKO Okeykey code book. It was the sign that he had opened a new account with EKO mobile money. Tulsi received a message about his successful account opening and was told that another message would come for activation. Tulsi said “Since I cannot read I automatically delete the messages always.” We told him to show the messages to someone to check about how to activate his account. 

The train was on track. I was happy. Will the ride be a smooth one? I contacted Tulsi to check that he had managed to register successfully but his mobile phone was answered by his son who informed me that his father had been hospitalised with an eye ailment. 

Days passed....

Two main problems became clear to me as I continued to work with Tulsi. The first was an error made by the retail agent. His thumb impression was taken in red ink when it should have been done in blue or black ink. The agent’s error was rectified when Tulsi made a fresh application, this time at the counter. The second barrier was Tulsi's illiteracy. Later I understood that his account had not migrated to the CBS platform of the State Bank of India (SBI) because he had given only 9 digits for his mobile number. When his 10 digit number was relayed to the EKO office, the account was finally activated, 61 days after the first step. During the long waiting period Tulsi kept asking me two questions: "Madam, I was told that account activation status would be known through a message, but it’s not yet received in my mobile phone.” And: “Madam, when can I go to deposit some money?" 

Four days after his account was opened he went to deposit a small sum of money to operate his “first bank account” but his enthusiasm was immediately dampened. The customer service representative told him to come back after 3pm the same day. Time is precious for rickshaw pullers and Tulsi could not go to deposit his money at a time that was convenient for him. In the interim, he lost his mobile phone while visiting his village two days after Dipavali (a major Indian festival.) When I met him on 23rd November 2012, he said he could not go again to the EKO counter because he did not have the mobile phone and had neither time nor money to buy another mobile phone now. He did not know about blocking the mobile phone (SIM) number with the service provider nor did he know about lodging a police complaint about the loss of his mobile phone and SIM card. When I told him that his lost mobile number is the account number for his mobile banking account and that he needs to get a duplicate number, he exclaimed: "Madam, what can I do? I don’t have time to go for this because I need to earn?” Nonetheless, he promised to speak to his son to get a duplicate number. 

Exactly a month later on 22nd December 2012, I met him again and he had not been able to get a duplicate mobile number; instead, he had found it easier to buy a new SIM card and a new mobile phone. What were the factors involved in this decision? "Time constraints" and "illiteracy"? Or should that be "time constraints" and his own "rational choice" from his perspective? I explained to him that he still needed to register the new mobile to his bank account.

After a missed meeting and repeated reminders we finally met, albeit two hours after the arranged time. But there had been a domestic crisis. His daughter-in-law had left for her mother’s village in a huff after a fight with his second son. His son had left soon after to bring her back. Tulsi’s mobile phone was taken by this son because the family only has two mobile phones – one with Tulsi and another at home with his wife. From my perspective, another delay, yet Tulsi was unperturbed. His concerns were more immediate such as how to meet domestic expenses in the face of spiralling prices, recurring health issues and his hand-to-mouth existence. As much as he wished to have a bank account, his desire to use the account to save was outweighed by the demands of his daily hardships. To put it another way, his daily struggles to make ends meet overwhelmed his desire to save in a bank account. 

As I write this post, tomorrow is another day when I am going to meet to take him to the EKO counter to get his account number changed. I am hoping that his desire to use the mobile banking account grows stronger than his never ending problems...