"The Mobile Money Experience in Sub-Saharan Africa" in The African Technopolitan Magazine

Take a look at IMTFI Postdoctoral Scholar Mrinalini Tankha's article, The Mobile Money Experience in Sub-Saharan Africa, featured in the most recent issue of the African Technopolitan, a magazine of the African Centre for Technology Studies (ACTS).

The article is part of the January 2016 issue on "The Poverty of Development Strategy in Africa" and provides a comprehensive look into IMTFI's research findings in Sub-Saharan African since 2009. It traces shifts in the mobile money landscape and also discusses patterns that endure by highlighting the role of deep histories, rank and hierarchy, ritual and religion and the stickiness of trust in understanding user interaction and uptake of new technologies. The article further emphasizes the role of  locally embedded rich qualitative research and offers suggestions for new future directions in mobile money research in the region.

Read the rest of the issue here.

Reimagining Rurality in Mobile Money Times: Life, Identity, and Community in Southern Uganda (Part 2)

By IMTFI Researcher Prince Karakire Guma

In my previous blog post, I showed how mobile money is not only meeting the needs and demands across demographically diverse populations in my study – wealthy and poor, young and old, male and female, rural and urban participants. It is also reinforcing new forms of interaction between them. I showed how mobile money has considerably affected – and become a fundamental part of  – everyday life. People who are registered with mobile money accounts are able to “connect to all,” enhancing and maintaining their pre-existing kin ties and friendships, as well as ways of communing, collaborating, and networking. In this part of the post, I seek to present exemplary cases of the broader impact of mobile money and its importance for notions of rurality in parts of Southern Uganda.

Community
One reality that constitutes a great part of reality of the rural in parts of Southern Uganda is the belief system of “obuntubulamu.” Obuntubuamu presumes that an individual does not and cannot exist alone but owes existence to the village and/or community. It is a system that simply recognizes the usefulness of community-centeredness. What makes the mobile money application ideal in this case is that it is not perceived as a threat to such ingrained and indigenous ideals, notions, and realities of the community. Instead, mobile money is the kind of application that is taken up by one so s/he is able to live on with their lives just as they did before it existed.

For example, many women have experienced subtle reforms in daily life, family life, community, and networks. Women describe a better life as the ability to be a good family, community and social person. They seem contented with the idea of being in small family groups in which they could express their opinions, concerns, and wishes. Besides, they claim to dress better, eat better, decorate their houses and take much better care of their gardens and animals. As the cashier of a local affirmative group argued:

"Before mobile money, we were left behind and excluded. Today with access to phones and money, we feel included. We feel empowered. We are even able to save up to cope up with droughts, disasters, and times of crisis through our networks that are now closer with mobile money. In times of crisis and need, I think it is a great system. Once we have got texts on the mobile phone, we can get the money immediately from our kin. There is no need to travel long distances."(Gift, 2014 interview)

Phones have intensified the kinship system in the rural. Such symbolic fields as kinship and rituals represent dominant practices and enduring meaning structures that cannot be ignored by the rural residents nor overlooked when interpreting village life. Especially important is the idea of gifting up and down generations in rural Uganda. Younger people give to parents, grandparents and other close kin in their parents' generation. This way, mobile money is able to enhance inherent informal risk sharing networks. Most users in Southern Uganda use it to support friends, family and relatives. It is a method for social gifting, and sometimes contributing to ceremonies and social rituals and functions.

Sending money is closely connected to practices of chatting or texting. Mobile money transfers between the urban and rural dwellers almost always follow a chat, a text message, a beep (or intentional "missed-call"), or a call between the two. Mobile money in Uganda has acquired an etiquette that is often followed when using the mobile phone. Participants often indicated that they commonly used their gadgets to maintain relationships through sending money, airtime, and similar gifts.

Women have increasingly formed self-help groups supported and sustained by mobile phone applications such as mobile money. One group that had benefited greatly from using mobile money among its services was the "Responsible Motherhood Savings Group." Members explained to me that they didn't have to worry about carrying money, carrying cash in bulk or standing in long bank cues to buy checks. Besides the tangible benefits, mobile money services have enhanced a community spirit as well as collective action among these women, reinforcing the feeling of community among members of the village. When one of the members faced a challenge, everyone in the group gave their individual contributions, sometimes through mobile money. Members argued that through mobile applications such as mobile money, they felt closer to each other than before—they were transparent amongst themselves and more connected. Through mobile money services people were able to care for each other and engage in each other’s lives.

Identity
Unlike in the urban where it is sometimes about class, convenience, networking, and just merely the position of the consumer, rural residents were motivated to adopt mobile money only then when they were sure that the emergent ways were better than the ones they had. Whatever mobile applications were used in a community and locality, it was because of its ability to solve something for the individual, for a group, for a community, or the entire village. From my observations, applications were appreciated for nothing else than their ability to solve a genuine problem that they faced.

Particularly interesting is the experience of one health-worker who said she had not returned to her home village since her father died in 1998. She said she no longer had any reason to come back just to pay homage to an almost "empty" village. However, when she finally traveled to the village over fifteen years later, she realized how much the rural had changed and explained how she has been making plans to settle and set up a mobile clinic there to make good use of mobile money applications (and be able to save) in the village.

In another interesting narrative, one herdsman excitedly told me how with his smart phone he will take a picture of a sick cow and explain to his boss the details about what and where the problem is. He will then receive money for its treatment through mobile money, or be advised to sell it in the market. He immediately sends profits over to his boss through mobile money. As the LC 1 Chairperson for the village confidently added, "today, the village is not just for the poor, the old or the sick; it is clear from the mobile phones that communication and the frequent use of mobile money are getting people out of the circle of total poverty." From these and similar responses it was possible to read the enlightenment on the faces of the participants as they pointed out how educated and financially-abled people they had become.

However, with the urbanization of African villages, the rural is losing much of its idealistic image. This is so much so that the rural is emerging as a model of "modernity."It is no longer that space of completely intact evergreen forests and arable lands. Due to globalization and rural-urban/urban-rural travels, there are many urban-like changes happening through use and uptake of mobile money services.

Even for businesses in the private sector – like the MNOs, banks and financial institutions – the rural is increasingly becoming a more dynamic and competitive environment. Infrastructural changes and the presence of mobile services are increasingly influencing lifestyles and in turn necessitating new models of survival. More connectivity has meant more access to infrastructural facilities, and ultimately, transformations in the conventional image of rural life and rurality. In many ways the rural is emerging as a global, dynamic, multi-faceted territory such that rural life is being re/shaped, re/drawn, re/constructed, and generally transformed.

While many embrace these changes, some residents see it as a danger. As one villager told me:

"It's just that my village is no longer the typical traditional self that it once was. I think that urbanization is beginning to have a real impact here, as the face of the city is increasingly being threatened and destroyed by these new innovations. The village is not as rural and traditional as it used to be. I do like the clean water, electricity, radio and TV, roads, cell phones, etc. But I mind that visiting it is no longer like going back in time. It’s more like a change of scenery.” (Namujju, 2014 interview)

Many rural residents were concerned about protecting, or at least paying more attention to the rural and its aspects and ideals, arguing that otherwise it would lose its identity. Rural areas should have a specific internal dynamic of changing and adapting.

Rurality in mobile money times

My study shows that mobile money is in fact proving to be integral to re-imagining rurality. However, further research is needed to show if rural elements are in fact being preserved, changed, or recreated in urban form. It is important to examine if mobile money will eventually change how we feel about rural space and if so, what its applications, services and innovations mean for rural authenticity.

For part one of Reimagining Rurality, see here

Read more in Prince Karakire Guma's final report here

Reimagining Rurality in Mobile Money Times: Life, Identity, and Community in Southern Uganda (Part 1)

By IMTFI Researcher Prince Karakire Guma

In some parts of rural Uganda, a whole village will use one or two phones to bank, to contact relatives, to share money amongst themselves, to access loans, and simply to check weather reports. Low teledensity does not imply lack of mobile money use and spread. Freed from the expense of ownership and maintenance, an individual of a particular group or community will spend longer periods of time per use on the available gadget(s), hence generating more revenue not just for the individual or group involved, but for the whole village. Such collective use by a community makes the dream for financial inclusion plausible—even a reality—for rural life.

In this 2-part blog post series I present vignettes organized around three themes—life, identity, and community—through which mobile money and rurality is re-imagined. Mobile money inclusion is providing new tools to maintain existing practices and values, reshaping but also reinvigorating rural-urban ties, and along with these, new understandings of the rural.

Rural Life, Identity, and Community in Mobile Money Times

My study provides a snapshot of the impact of the mobile financial services in rural Uganda in relation to debates on financial inclusion and empowerment. Mobile money is increasingly turning out to be a most viable tool of financial inclusion to those who have neither bank accounts nor deposit lockers nor credit cards, but do have a basic mobile phone. The Ugandan Central Bank recently cleared the path to mobile finance, a shift that forced the nation’s banks to look seriously at the low-income consumer banking market for the first time. Provoked by discussions of rurality vs. urbanity and the exclusion of remote and rural towns and villages before mobile money, I wanted to understand the extent of changes today in light of the rise of initiatives such as MTN Mobile Money (MTN), Msente (UTL), Airtel Money (Airtel), and Orange Money (Orange), which have led to the growth of an increasingly complex mobile money ecosystem that allows funds to be transferred between rural and urban subscribers. Mobile money has changed the ways of life for groups most at risk of poverty and social exclusion that often lack access to traditional bank accounts. Populations previously excluded because they do not own property or a business are beginning to get included through a myriad of mobile money innovations and applications.

With the emergence and dispersion of mobile money services in southern Uganda, 'the rural' has attained a certain kind of dynamism and fluidity, and a whole new identity through varied features of lifestyle, community, traditions and landscapes. I explore this problematic within a so-called “traditional” rural setting—still remote, excluded and poverty stricken—that is at the same time representative of emergent and transformative innovations through mobile money. I understand the rural as part of an integrated space within mobile spatial systems that delete, rub away or dis-able the aspect of distance between issuer and receiver, urban and rural, and modern and traditional. I explore how the rural territory is re-interpreted through processes, lifestyles and behaviors influenced by the new contemporary technologies of mobile financial transformations.

The setting for this study is the village communities of Masaka and Rakai comprised of households that are spread over hilly lands. Families of up to five adults and sometimes ten children live in a single homestead, which are often clusters of mud-brick and iron-roofed two or three bedroom dwellings with a sitting and dinning room, and occasionally a kitchen. Birdcages, kraals and/or gardens are reserved for subsistence crops – especially banana cultivation.

Most people have extensive kin across the corners of the village or in the neighborhoods. Given that many can trace their ancestry over five generations, the idea of family, kinship and network in such communities is profound. These are rural communities in every sense. But there are also glimmers of transformation with regard to life, community, sociality and identity.

Interviews and focus group discussions were my primary method in the two communities, along with observations of daily activities. I identified community leaders, such as local councilors, religious leaders and traditional leaders, as potential participants and used purposive sampling to ensure a full range and extent of the phenomena necessary to answering my research questions. This method of analysis allowed me to better understand the 'lived' realities of mobile innovation in the rural context in ways that challenge the discursive marginalization of communities most at risk of rural poverty and social exclusion.

Life

The money transfer application has proved to be the most important “killer application” of mobile money, fundamentally transforming rurality in Southern Uganda. It supports the indigenous and traditional settings, realities and world-views of the Baganda who constitute about six million people, or 16.7 percent of the entire population of the country.

Before mobile (money) innovations and services, quality of life and access to social services were poor in the southern districts of Uganda. Literate rural residents exchanged information on crucial news such as serious illnesses through letters. But for the illiterate this was problematic. Letters were less informative and were often disseminated informally through trusted friends and it would often take days, weeks or even months to receive a reply. Today, calling and the use of texts or "SMS" have replaced most of the letter writing. Mobile money, which operates through text and "SMS," meets basic functionality needs and operates on the most basic handset. It takes old technology and uses it in new and innovative ways that enhance and substitute older practices of sociality, social life and lifestyles. 

Mobile money has tremendously influenced peoples’ savings behavior where previously keeping money under mattresses or in fabric, often tied in knots, was common. Now mobile phones are clearly substituting for traditional unreliable savings channels and remittance services. Where previously people only used trustees and formal institutions including banks and other financial institutions, mobile money has now made it possible to send money from urban centers to Ugandan villages through remittances at even lower transaction costs. Without having to travel long distances and cue in traditional banks, or travel across borders, rural dwellers are now able to receive money in the comfort of their homes. 

Mobile money is also substituting traditional ways of making monetary payments. Payment through agents or “middleman” have especially been substituted by mobile means of cashing in (depositing funds), cashing out (withdrawing of funds), transferring funds through person-to-person (money transfer) or purchasing of airtime, even to make payments to workers. When asked why they used mobile money, some rural residents in my study suggested that it was the appropriate alternative and substitute to unfavorable fixed and traditional ways of spending money such as cash. They said that using traditional bank accounts, credit cards and financial facilities were very complex to understand, operate, and maintain in remote villages and was often the preserve only of those wealthy enough to afford a handset. They pointed out that mobile money improved access and efficiency and simplified their lives when they needed to access goods and services. 

The sector that has benefited the most is probably education, where schools have substituted traditional means of paying tuition and other school fees – such as delivering funds in person or proxy, and use of agents such as banking institutions – with mobile alternatives. Many community schools in the region have now adopted mobile money as an acceptable means and mode of payment. They were registered with MTN and Airtel Uganda Limited where parents were allowed to transfer school fees and other school related costs for the kids. Some explained that they used electronic transaction forms for additional home goods and food items such as sugar and salt. Others used mobile money for paying utility bills for water and electricity, and salaries to their house girls or housemaids and other support staff in their homes, instead of going to the bank to withdraw cash.

Mobile money remittances exert multiplier effects on the community. For instance, they have in some cases motivated young local men and non-receiving households to start seasonal entrepreneurial activities. Before, youths used to have no choice but to leave their villages for towns and cities like Masaka, Mbarara and Kampala, so much so that there were not enough youths to work in farms and gardens. But with the fast paced changes through mobile money many are now realizing that the rural is indeed a fine place to live and work. One young man who was part of a group of young men molding mud bricks and then baking them in huge ovens to make them strong and resistant to erosion by water or rain explained how they would sell the bricks to the remittance-receiving households to build houses on their homesteads.

In fact, where non-existent infrastructure has typically stood in for the “rural” as static or cut-off from the world, it is exactly this reality that shows dynamism because it has inspired the tremendous uptake and transformation of mobile money. The absence of clear roads, accessible banks, hospitals and transport facilities in rural areas explain why a mobile phone will be popular for saving, transferring and making real-time payments. Access to health attention and remittance payments through mobile technology is a dream come true for rural residents. There was also the case of multi-nationals and NGOs coming to the village that had substituted in-person payments in cash with mobile money payments and other mobile applications to reach out to the communities and distribute emergency aid to families. 

As such, the new infrastructural concepts engineered by MNOs are not only broadening the range of transactions that target the rural poor, they are also providing dynamic substitutes making rural spaces and territories even more fluid. Such accessibility and availability means that almost everyone in every corner of the country, community and village has a story to tell about mobile money.

While the increasing number of money transfers from urban to rural territories through the mobile phone has also increased the flow of information between people in and outside the village, one consequence is that urban dwellers are increasingly keeping away from these rural localities owing to the convenience and reliability with which mobile applications provide them. According to a church priest,

"... a lot of people here come to the village when it's Christmas. They only come to the village for the seasons’ holidays. And when they come here, it’s as if there is nothing to keep them there. They leave as soon as they arrived. Mobile phones have encouraged our people in the urban not to visit at all. They have provided an easy means of communication and sending money. People no longer need to physically come here. It is as if the major motivation for people to purchase phones nowadays is so that they can avoid expenditure on travel to the village. It is as if there is no need for the inconvenience of having to make constant trips to the rural." (Sam, 2014 interview)

While some study participants worried about the changes brought by mobile money it was also clear that it was not introducing entirely new ways of life but substituting what already exists. Mobile money seems to enhance rural lifestyles of community through which people who are registered are able "connect to all" including their kin, friends and community. It provides opportunities to establish and maintain community, collaboration, and access, which I will describe in part 2 of this blog post. 

To read part 2 of Reimagining Rurality in Mobile Money Times: Life, Identity, and Community in Southern Uganda, see here.

Unemployed Ugandan Youth Gravitate to Sports Betting

By IMTFI Researchers Bruno Yawe and Kizito Ssengooba

Billboard of a betting shop in Kampala (Photo by authors)   

Sports betting can be described as the activity of predicting sports results and placing a wager on the outcome which may result into a loss or a win. About 62% of Uganda’s youth are not in any form of employment and the majority of them live in urban centers (ActionAid International Uganda, Development Research and Training and Uganda National NGO Forum, 2012).The growth of the internet and mobile devices with quick access to odds has made betting much more accessible.

In particular, sports betting has spread among Ugandan youth like wildfire. Several sports betting companies have recently set up shop in urban and semi-urban areas around the country. Unemployed young people gather at these betting parlors to gamble on things like televised soccer matches. On the weekends, hundreds of sports betting outlets are filled with young gamblers, most of them without any regular income. At the betting parlors in Kampala and its neighborhoods, young men watch soccer matches on flat-screen TVs. Every day, betting companies put a lineup of games for the public to bet on. For every game, there is a team of analysts who analyze the strength and prospects of each team. The stronger the team is, the higher the likelihood of a win but the lower the odds and return. The average bet size is about US$ 0.5. With this information, a prospective wager will place bets and wait for the results. Many unemployed youth are being lured into predicting sports results and placing bets by popular FM radio stations. Youth in the Wakiso and Kampala districts have embraced sports betting for survival because they have no jobs and see this as an opportunity to make some quick money. Majority of the youth interviewed said “I would rather try my luck with betting UGX 1,000 (US$ 0.5) and hope to win and meet my pressing needs than living without any hope at all.” Some say it is a good source of income, but others are not so sure.

Youth viewing match fixtures (Photo by authors)   

Lucrative, Legal Lure
The business of sports betting is give and take. For example, if everybody should bet on Barcelona today and Barcelona loses, betting shops benefit. Conversely, if everybody should bet on Barcelona today and Barcelona wins, betting shops lose while the customers benefit. Betting shops hire young people to work at their branches around the country, thereby creating hundreds of jobs. Although these sports betting operations are legal in Uganda they are not adequately regulated by the government. Before January 2014, there were no clear laws or guidelines to govern gambling in the country. Because of this lack of laws, some companies refused to pay up when somebody won a bet.

Deep Concerns
With the increasing presence of betting shops, some officials charged with youth welfare are very excited and are in agreement with their operation in the country. They argue that they will help to promote the government’s poverty reduction strategy by providing some employment opportunities to the youth. They claim that as more sports betting shops are licensed, more employment opportunities are created in the country. But not everyone agrees that this is a positive thing. Gambling is bad for Ugandan society. This is because the majority of youth are no longer going to school nor seeking gainful employment. They spend the entire day at the betting parlors. Some say the expansion of legal sports betting is fueling vices like the use of tuition fees for betting (among in-school youth); theft and cheating; more illegal street gambling; and sapping young people's motivation for finding jobs.

But back at the betting parlors unemployed youth say that they do not have much choice. They argue that there is no adequate social protection to shield them from the adverse effects of joblessness. They are not betting because they want to bet. Rather they are betting because they want to make a living. Gambling in general and sports betting in particular is growing rapidly, and Ugandan society is sitting on top of a gambling problem time-bomb. Gambling and betting represent new drivers of chronic poverty among Uganda’s youth. Many youth are abandoning participation in productive activities in favor of gambling, especially sports betting. This has emerged as both a rural and urban phenomenon and has increased idleness, diverting would-be productive resources in the hope of winning bets.  There is need for proper regulation of the gambling industry and more sensitization on the dangers of this practice. To address the adverse effects of gambling, Gamble Aware Uganda provides support, information, and advice to anyone suffering from gambling problems. The high unemployment rate among Uganda’s youth poses a serious threat to the country’s well-being.  The unemployed youth are likely to become a source of instability if the government does not plan for them early enough. There is need for urgent intervention to plan for the idle youth population who are likely to become a problem to the country’s security.

Read more in Bruno Yawe and Kizito Ssengooba's Final Report. 

Click here to listen to a radio program on sports betting on Uganda Radio Network in which Bruno Yawe was a participant. The program took place on 10th January 2014 at Makerere University. 

IMTFI PANEL at 54th Annual Meeting of the African Studies Association

By IMTFI researcher Vivian Dzokoto

Since 1957, the African Studies Association (ASA) has converged individuals with academic and professional interests in Africa, and served as the leading North American organization promoting the academic study of that continent. This year, IMTFI sponsored a panel at ASA’s annual meeting in Washington, D.C. In line with the conference theme “50 Years of African Liberation,” the IMTFI panel was titled “Money, Technology and Financial Inclusion in Africa: What We Know After 50 Years of Liberation.”

Out of the conference’s 214 panels, the IMTFI-sponsored panel was the only one that focused on contemporary financial services and the poor. The panel highlighted major findings from 4 of 20 research projects focusing on various countries in Africa that IMTFI has funded over the past 3 years. Presenters examined pathways and obstacles to achieving financial inclusion for the poor in Botswana, Ghana, Kenya, and Ethiopia.