The Missing Piece of the Fintech Puzzle: How Local, Informal Networks Play a Crucial Role in Remittances

by Daivi Rodima-Taylor and Bill Maurer in NextBillion

Kuria cash contribution group in Tarime highlands, Tanzania. 

We are in the middle of the “fintech age,” a time of rapid development and adoption of new financial and payment technologies worldwide. The spread of fintech is not just touching more lives; it is bringing those users, and their relations, directly into the realm of finance.

The impacts of this transformation range from exciting to troubling. To take just one example, digital payment infrastructures spreading in the Global South make visible the digital footprints of billions of people who have not been part of the formal sector. On the one hand, this is making credit available to customers who’ve long lacked access – but on the other, it may bring along exploitative “dataveillance” and over-indebtedness.

Whatever their impacts, fintech initiatives in emerging markets often build on interpersonal patterns of mutuality, fostering and capturing diverse “sharing economies” and bringing the affective into the purview of formal finance. In other words, these initiatives tend to harness existing community networks and informal methods of transacting, aiming to reflect or replicate their dynamics through formal products.

The interaction of local informal institutions and norms with formal digital finance initiatives is particularly pronounced in the Global South. But these interpersonal dynamics are vastly underexplored, and their significance underestimated. We argue that fintech endeavors in the payments and remittances space tend to overlook how their efforts are mediated and adapted by local gatekeepers. These gatekeepers may range from mobile money agents to neighborhood shopkeepers, and they mitigate the diverse risks of money transfer, and direct the new resources into socially acceptable pathways.

Put simply, we often err in assuming a remittance is a person-to-person transfer. Often, it’s a person-to-intermediary-to-person transfer (sometimes with several intermediaries along the way). Intermediaries fulfill a host of functions for the end points of a transfer, serving as guides, translators, helpers and guardians of values beyond the economic. Understanding these roles has implications for service design – in this article, we’ll examine them in more detail.

The Role of Gatekeepers – and the Meaning of Money
International and domestic remittances remain central to the livelihoods of many households globally. Officially recorded global remittance flows have nearly doubled over the past decade, growing from US $380 billion in 2007 to US $689 billion in 2018. They constitute the largest foreign capital inflows to many world regions. Our recent research shows that the remittance infrastructures in the digital age – including mobile and digital currencies, “traditional” remittance companies like Western Union, and other fintech players – are best seen as multi-level, fragmented and overlapping assemblages of diverse pathways. These pathways often include monopolistic companies like Moneygram (which provides cross-border remittances) and Safaricom (which distributes Moneygram remittances via mobile money transfers in-country). These different networks are kludged together and mediated at their connection points by diverse social and institutional gatekeepers. These gatekeepers may include local mobile money agents, informal savings groups and alternative moneylenders, and also retail shops and pawnbrokers that facilitate remittances – all of whom often help traverse the “last mile” to end-users.

Mobile money agent in Gulu, North Uganda. 

These gatekeepers often become part of the “story” behind the funds they help distribute, as these seemingly interpersonal money flows are actually an important repository of meaning and social markers. That is, the money carries social and moral commentary while chronicling people’s daily lives and trajectories, reflecting the memories and intentions of individuals and their social networks. For example, money gifts may mark human relationships and celebrate temporal cycles, such as the hong bao of the Chinese New Year – red envelopes containing money, exchanged among friends and relatives. Not surprisingly, the payment function of China’s ubiquitous messaging app, WeChat, only gained traction when it let people send each other digital hong bao, thus harnessing existing cultural beliefs and practices around money.

To grasp why it’s so important to understand the different cultural meanings behind money flows, consider the Kuria people of northeast Tanzania. In this community, informal agricultural labor sharing groups draw on longstanding norms of reciprocity, and have morphed into cash mediators in modern money transactions. These mediators fulfill the role of safely and morally bringing outside flows of money to those inside the group. Their role is consistent with Kuria cosmology, which highlights a constant mediated interchange with the outside, using the metaphor of the “throat” or “windpipe” (omooyo) for transactional pathways.

Consider how this is similar to and different from hong bao. To the Chinese, these red envelopes signify luck and protection against evil spirits, whereas to the Kuria, omooyo signifies the pathways that connect inside and outside. Designers of digital money systems have an easier time adopting cultural practices like hong bao, which can be easily seen, than social relationships like those represented by omooyo, which are difficult to detect unless you are enmeshed in them. Therefore, when users report on surveys that they use mobile money for something like “school fees,” for example, a product designer needs to look a little deeper to see through whose hands and phones the money actually passes along the way to its destination, and what relationships are activated in the process. This may reveal insights like those found in western Kenya, where “school fees” payments frequently take an important detour through coming-of-age rituals that stitch together city, country and kin.

The Importance of Local Intermediaries
In African societies, the role of marking and channeling any new resources has long been performed by informal mutual support groups and peer networks like the Kuria labor-sharing groups. These groups remain important actors in channeling e-money in modern-day mobile money systems. They help redistribute and circulate money along their established social networks, based on reciprocity and mutual obligation.

But the effects are sometimes contradictory. In some instances, mobile money networks can facilitate resource pooling and sharing among extended kin and peer groups – and this can foster new connections. In other cases, the availability of digital remittances can lessen interpersonal contacts and weaken social and family ties, as it eliminates the need for physical travel, in-person meetings and visits back home. Yet, in still other cases, the weakening of some ties can strengthen others: Removing physical distance and travel can facilitate women’s networks separate from men’s, which can mobilize resources to support the women’s goals—for instance, in subverting male elders’ choice of one marriage partner over another.

For these reasons, providers should focus substantial attention on such intermediaries, including the mobile money agents – or “cash merchants” – who buy and sell e-money. They are crucial to the cash-in, cash-out process of using mobile money – but in many emerging countries, they do much more. Many are local shopkeepers, part-time retailers and hawala remittance distributors. They have their own embedded systems of relational contracting and social expertise. They are not, in other words, mere “human ATMs,” but rather they interject their social relationships into transactions to facilitate their customers’ actual intended goals (holding e-money or cash for them for a time, assisting with bill payment, and providing financial advice or loans). Hence, agents do not just facilitate transfers, but broker and redistribute remittance flows. Mobile money companies may try to break these old habits, but in trying to do so, they also make their service less valuable to the people who want to use it to facilitate all the things an intermediary can accomplish for them.

Bringing Intermediaries into Focus
Diverse human and social intermediaries in local communities are thus important elements in emerging digital infrastructures. Bringing into contact different recording devices, accounting practices, and purposes and intentionalities, these local gatekeepers transform and co-create the payments infrastructures. As they cut into these interpersonal exchange networks, digital payment platforms act as novel interfaces between formal and informal economies.

A focus on the social relations of digital payment infrastructures enables us to see what is obscured by the seeming neutrality or seamlessness of the technology. In an age where digital infrastructures increasingly leverage futuristic technologies like self-learning algorithms and smart contracts, it is particularly important to remember that “old fashioned” social intermediaries often play a central role in their adaptation and use. Designing systems with intermediaries in mind from the beginning, not as passive pass-through points but active brokers, might enable such technologies to get further reach without sidelining the human interconnections people often use money flows to forge and maintain.

Daivi Rodima-Taylor is an anthropologist and Africanist at the Frederick Pardee School of Global Studies, Boston University, and Visiting Researcher at University of California, Irvine.

Bill Maurer is Professor of Anthropology and Law, University of California, Irvine, and Director of the Institute for Money, Technology, and Financial Inclusion (IMTFI).

Photo credits: Daivi Rodima-Taylor.

View original post on NextBillion: https://nextbillion.net/fintech-local-networks-remittances/

Advancing gender equality with mobile money - conferencing in Tanzania

By IMTFI Fellow Milcah Mulu-Mutuku (Egerton University, Kenya)

Fig 1: Gender Inequality Source:
http://www.chronicle.co.zw/wp-content/uploads/2014/06/gender.jpg

Gender inequality continues to be a defining feature in contemporary societies, especially in emerging economies. Despite great transformations in gender dynamics, there still exist glaring disparities between men and women in various aspects of life, ranging from students’ enrollment in institutions of higher learning to leadership positions in these institutions; from accessing job opportunities to power relations in the office space; and from interactions at household and community levels to participation in decision making arenas. On average, men are better positioned in this pecking order than women (UNDP, 2013).

Fig 2: Conference banner at DUCE Gate

The Dar es Salaam University College of Education (DUCE), a constituent college of the University of Dar es Salaam, organised the 1st International Conference on Gender Issues in Higher Learning Institutions on April 27-28, 2017 (view book of abstracts here), culminating with a visit to Mikumi National Park on April 29, in order to “explore and reflect on gender issues and on how best to redress them in the context of higher learning institutions with the aim of realizing human rights and gender equality as speculated in various national and international instruments.” Framed by the theme ‘Equity and Equality for All,’ the conference brought together over 100 attendees from over 20 countries. The inauguration speech was delivered by the Minister for Health, Community Development, Gender, Elderly and Children, Hon. Ummy Mwalimu (Fig. 3-Front row, center seated) on behalf of the Vice President of the United Republic of Tanzania, Hon. Samia Suluhu Hassan. This is an indication of the importance attached to this event by the Tanzanian government. The Ministry headed by Hon. U. Mwalimu has a directorate that is in charge of all gender equality related matters in Tanzania, making her the appropriate representative of the Vice President at this conference.

Fig. 3: Hon. Ummy Mwalimu (center seated) with other dignitaries,
keynote speakers, and a section of paper presenters (courtesy of DUCE)

Six keynote speeches were delivered, and 45 oral and four poster presentations were made. Presentations covered a wide range of topics, all touching upon gender issues. I had the opportunity of presenting a paper co-authored with Castro Gichuki* entitled, “Mobile money and financial inclusion in emerging economies: a strategy of addressing gender disparities in control of financial resources.” The paper advocated for use of technology in addressing gender disparities, and was based on a larger project funded by the Institute for Money, Technology and Financial Inclusion (IMTFI) of the University of California at Irvine that aimed to explore the influence of mobile money on women micro-entrepreneurs’ control of productive resources. Data were collected in 2016 using mixed methods, including questionnaires, object-centered focus group discussions, and in-depth interviews.

Control over productive resources and especially finances is culturally a gendered issue in favour of men in many emerging economies.

Fig. 4: Making a presentation (courtesy of DUC)

This has a negative impact on women’s economic activities, thus necessitating a search for strategies with the potential to remedy the situation. Difficulties associated with fighting gender disparities stem from the reality that these disparities are reinforced by some deeply held cultural practices and beliefs. Culture defines ‘codes of conduct’ among those who share cultural ties. Since it is socially transmitted, people who interact regularly share unwritten rules that govern life (Daher, 2012). These are not issues taught in school or through any education system; people inherently know and understand them through socialisation, shaping their way of thinking, behaving and expectations of others. Needless to say then, strategies that have the potential of eliminating or minimising gender disparities are those that are responsive to the culture of the people, and that can be easily integrated into existing social arrangements rather than conflicting openly with deep held beliefs and practices.

Considering technological progression and what it has achieved historically, it may hold the key to unlocking the dilemma of culturally reinforced gender biases and the mindsets that perpetuate them. The term ‘technology’ elicits thoughts of tools and instruments for enhancing human performance, shaping nature, and meeting human needs, and the accompanying knowledge about their use. A third component of technology that is not talked about as much is culture. As Vergragt puts it, “Use of technology is learnt, interpreted, and given meaning in everyday life” (2006:2). If found acceptable, technology is adopted and assimilated into the lives of people, slowly becoming part of their culture. Ask Kenyans today, and they wonder how they ever survived without M-Pesa! Why? Because the technology has become so entrenched in their lives that it has become part of their culture.

Once a particular technology has been accepted as a way of life, the oppressed or the disadvantaged in society can then use it to their advantage. A case in point is the ingenuity of women micro-entrepreneurs in the use of mobile money to gain control over business finances without conflicting with their husbands. We found in our study that women micro-entrepreneurs whose husbands had a tendency of interfering with business finances transacted secretly using mobile money services. These women paid for services and goods using M-Pesa and deposited money into their savings accounts secretly. Messages from the mobile money service providers were deleted immediately after the transaction to erase any evidence. This way husbands did not know, and could not keep track of, how much money the business was transacting. This was done to safeguard business money against misuse, a mission impossible for those transacting with cash. This then makes technology progression a crucial tool in breaking the gender disparity cycle.

Conference attendees were fascinated with the use of object-centered focus group discussions as a technique of data collection and were interested in understanding it better. This is a technique we used to stimulate conversations around the difficult topics of personal financial practices and culture. We used charts to prompt participants to think through their financial practices and to discuss their level of control over productive resources and the influence mobile money services had on their control and decision-making processes regarding the resources (for more information on this subject, please see our IMTFI blog: Object-Centered Focus Group Discussions: Stimulating Conversations on Mobile Money Practices and Culture.

Dr. Susan Murphy, one of the keynote speakers, led the conference participants in exploring the role of education in creating gender awareness and transformation. The unparalleled capacity of institutions of higher learning to act as spaces for transformation through a focus on excellence, critical thinking, and constructive engagement was acknowledged. These institutions have the opportunity to lead transformative thinking on gender identities and the social constructions of masculinities and femininities, a point affirmed by Dr. Su-mung Khoo, another keynote speaker. Nonetheless these institutions hold dominant biases and discriminatory perspectives specific to their communities that tilt the scales toward exclusivity.

As observed by Prof. Anne Looney, Prof. Anne Ferguson, and Dr. Amy Jamison (other keynote speakers), gender inequality in institutions of higher learning is an internationally observed phenomenon, with key leadership and academic positions being held by proportionately more men than women. Prof. Looney called it ‘a crisis of justice and a crisis of quality perpetuated by societal cultures and systems.’ We noted that nations have good intentions to create equal opportunities for both men and women, and even legislation is in place to that effect. However, in most cases these intentions are not translated into practice due to deep rooted biases and stereotypes. Therefore, Prof. Ruth Meena implored participants to change the narrative from barriers, challenges, and limitations to promoting enablers of gender equality. Some enablers that were identified included commitments by governments, roles played by gender and human rights activists, and technology.

Fig. 5: Paper presentation session in breakaway room TPC 106
 (courtesy of DUCE)

On the use of technology as a tool for addressing gender disparities, Dr. Conor Buggy pointed to the ‘blindness to gender’ in anonymized online teaching and assessment which allows all students to achieve their learning outcome without unconscious bias or prejudice from fellow students and teachers. This concurred with our assertion that mobile money technology progression is an asset, especially for women micro-entrepreneurs, for gaining control over financial resources and, to some extent, equalizing the playing field between men and women. Mobile money enhances privacy and autonomy of financial transactions due to its invisibility compared to cash, meaning women are able to transact without conflicting with male relatives who may hold the belief that control over financial resources is a preserve for men (Donovan, 2012). As society ‘drags its feet’ in addressing gender biases, women can continue providing decent meals for their families in an environment of peace afforded by mobile money technology.

References

Daher, M (2012). Cultural beliefs and values in cancer patients. Annals of Oncology, vol. 23(3). Pp. 66-69.

Donovan, K. (2012). Mobile money for financial inclusion. In T. Kelly and C. Rossotto (Eds.), Information and Communication for Development, pp. 61–73. Washington, DC: World Bank.

UNDP (2013). Humanity Divided: Confronting Inequality in Developing Countries, available at: http://www.refworld.org/docid/52fcc3fe4.html [accessed 18 July 2017].

Vergragt, P. J. (2006). How Technology Could Contribute to a Sustainable World. GTI Paper Series Frontiers of a Great Transition No. 8, Tellus Institute, Boston MA.


Read about her experience presenting at the Making Markets Matter Executive Training Program (May 2017).

Mobile Money Uptake, Savings and Social Networks in Tanzania: A Lesson in Methods

by Alfredo Burlando, Cynthia Kinnan, Silvia Prina

When we decided to work on mobile savings in Tanzania, we had an initial understanding of the value of formal savings from the economics literature. We knew that savings accounts — from banks or mobile money operators — were becoming increasingly common in many unbanked areas of the world, and that adopters derived some important benefits from their accounts (Dupas and Robinson 2013; Prina 2015). What was less clear, and became the focus of our work, was the extent to which savings accounts generate social benefits (or costs). In particular, we became interested in measuring the extent to which savings accounts generate “network spillovers”— that is, impose benefits or costs on the adopters’ social network. The questions we posed to ourselves were: Do savings spillovers exist? Are they positive? Negative? Or both? Who gains and who loses? Finally, does savings generated through mobile money accounts lead to such spillovers? 

EZYPesa stand in Zanzibar Town

We have several reasons to believe that spillovers from savings exist and have important policy implications. Conceptually, positive spillovers may arise because savings access appears to raise the incomes of adopters, and a long line of economic research indicates that income gains may be shared among social networks. Mobile money facilitates transfers, and therefore could also facilitate this type of spillover. The case for negative spillovers is more nuanced, but also plausible. Existing economic theory indicates that savings could encourage “shielding” cash from social networks. In practice, we have evidence from sub-Saharan Africa that households appear to attempt to avoid “kin taxes,” (see Baland et al. 2011; Dupas and Robinson 2013; Jakiela and Ozier 2012) and savings accounts may play a role in this avoidance. Given this premise, we hypothesize that different members of a social network may experience different effects. “Altruistic” ties (those characterized by “I want to share”) may experience positive benefits while “obligatory” ties (characterized by “I have to share” may experience negative effects). If obligatory ties tend to be poorer to start with, inequality may widen and, in turn, inequality may aggravate negative effects through a vicious cycle. 

Once we decided on the hypothesis, we set on creating a randomized control trial that would allow us to generate, measure and ultimately study these spillover effects. At the time of writing this blog, we have completed all aspects of the trial and are working on the analysis. 

Our intervention: Zantel’s EZY-Pesa in Tanzania

In our research, we distributed mobile savings accounts to approximately 1,500 participants in 33 rural and peri-urban areas of Zanzibar (Tanzania), and then studied the effects of adoption of these accounts on the adopters’ social networks through follow-up interviews. This work was done in partnership with Zantel, Zanzibar’s leading mobile phone operator whose mobile money product, called EZY-Pesa, allows deposits and withdrawals through local retailers. At the start of our study, this product was not widespread outside Zanzibar Town, and Zantel agreed to implement a marketing campaign tied to the study.

Scheme of Intervention

Our work began in September of 2013. Our research partners in Tanzania advertised a community meeting where a study tied to savings accounts was carried out. We then surveyed those individuals who showed up to the meeting and had expressed interest in opening a mobile money account. We collected baseline data on their income, occupation, and other socioeconomic markers. In addition, we collected information about their “key network partners”: financial partners, friends, advice-givers, etc. The key partners were ranked by respondent on the basis of questions such as “Imagine you got a surprise payment of Tsh 100,000 (~$65). Who would you most want to keep this secret from? Who least?” This way, we were able to identify other people in the community who were likely to be either an “altruistic” tie, or an “obligatory” tie.

Following the interviews, we coordinated a mass marketing campaign with Zantel in October through December 2013. We randomly assigned some of our baseline respondents (“focal respondents”) to receive help signing up for EZY-Pesa. The marketing visit included a one-on-one explanation on how to operate EZY-Pesa to accumulate savings. Importantly, marketers were not allowed to talk about the transfer features of EZY-Pesa. Finally, to encourage usage, we also made a Tsh 2000 (~$1.25) initial deposit in their new EZY-Pesa accounts. The remaining households were randomly assigned to receive Tsh 2000 in cash, no marketing visit, and no sign-up assistance. 

In summer 2014, we identified baseline respondents (“focal households”) plus one tie we deemed to be “altruistic” and one tie we deemed to be “obligatory”. Ultimately, we were able to gather information from a large number of participants—over 1,500 focal individuals and 2,500 of their social ties. In this endline survey we collected information on demographics, informal transfers, and demand for savings. Respondents were also asked whether they received a marketing visit in October through November from Zantel, and whether they opened a mobile account. We used the answers to these two questions to determine how well the marketing intervention went. 

Stumbling blocks on the road to analysis  

Marketers were instructed to enroll in EZY-Pesa only those focal individuals who were randomly assigned to the treatment. Unfortunately, the marketing visits were not targeted as agreed, complicating our efforts to study their causal impacts. We found that only one quarter of treatment individuals reported being visited by Zantel representatives; moreover, one fifth of focal individuals assigned to the control reported receiving a visit. (A much smaller fraction, 13%, of ties reported a visit from marketers). Since there is not much difference in the likelihood that a focal person received a marketing visit, we could not use standard methods of analysis for experiments. 

Despite this setback, we find that the marketing visits were effective at signing up new users: 40% of visited treatment individuals opened an account. This is higher than take-up rates of microfinance (e.g. Banerjee et al. 2015). Of those who signed up, 52% used the account “actively” (two or more times), a figure similar to findings for traditional savings accounts in Kenya (Dupas and Robinson 2013).

Fraction of respondents who opened a mobile savings account    

Fortunately, a much smaller proportion of visited control individuals (24%) and of visited ties (19%) opened a savings account. We interpret this to mean that many Zantel marketers indeed declined to sign up those not formally assigned to the treatment. Because of this, we do observe a statistically significant (albeit small—only 5%) difference between the fraction of all treatment individuals opening an account and the rest of our respondents. 

The road ahead

Just because marketers did not follow the instructions provided does not mean we cannot uncover the spillover effects. By pairing each focal individual who received a marketing visit with another focal individual who was skipped by the marketers but has very similar characteristics, we can use “matching” techniques to study both positive and negative spillovers on the paired ties. 

While we now working through this analysis having derived certain lessons from our intervention. First, (mobile) savings are not for everyone: of a group that expressed interest in EZY-Pesa, 40% of those who received a marketing visit signed up for an account and among these only half of those who signed up used the account actively. While there is an active discussion on the importance of reducing fees and entry costs, our study suggests that reducing those costs to zero is not enough. Costs are not the only (or perhaps even the main!) barrier to adoption.

Second, we think that our partnership with Zantel had an important benefit: having done almost 700 marketing visits was certainly a big accomplishment, and it increased “external validity” (and hence the scalability of the intervention). On the other hand, the scale did come at a cost: there was noncompliance in the way marketers approached local communities, and this reduces the study’s “internal validity” (i.e. ability to estimate causal impacts without additional assumptions). It will be interesting to see if future studies will emerge that can address the latter. 

Works Cited

Baland, J.M. ,  Guirkinger C., and  Mali, C. (2011). Pretending to Be Poor: Borrowing to Escape Forced Solidarity in Cameroon, Economic Development and Cultural Change, 60(1), 1 - 16.

Banerjee, A. V., E. Duflo, R. Glennerster, and C. Kinnan (2015). The miracle of microfinance? Evidence from a randomized evaluation. American Economic Journal: Applied Economics 7(1): 22-53.
 
Dupas, P. and J. Robinson (2013). Savings constraints and microenterprise development: Evidence from a field experiment in Kenya. American Economic Journal: Applied Economics 5(1), 163–92.

Jakiela, P. and Ozier, O. (2015) Does Africa Need a Rotten Kin Theorem?  Experimental Evidence from Village Economies. Review of Economic Studies.

Prina, S. (2015) Banking the Poor via Savings Accounts: Evidence from a Field Experiment. Journal of Development Economics, 115: 16-31.

Trickling Down and Spilling Over: Social Organization, Power & Hierarchy

When I was in India this summer, the fact that I wore no jewelry save for a plain gold wedding band was perhaps the single most commented upon aspect of my appearance during my travels there. In "Silk Societies, Gold Stories: Using Gold-Based Life Stories to Study Gender, Financial Inclusion and Work Vulnerability in South Indian Sericulture," Nithya Joseph explained that -- in the case of gold -- "objects that don't appear to be necessary" may serve critical semiotic functions, particularly as a marker of class and caste.  In her study of political economy and worker vulnerability that used oral history as a method, gold objects served as significant markers of memory.  After twenty or thirty years, it was often difficult for informants to remember precise details of their financial histories, but aspects of everyday life were embedded in narratives about gold that allowed those interviewed to describe where they were in social hierarchies and how their positionality impacted their well-being. Oral histories were structured by a recounting of life cycle events, a learning/earning history, and narratives about gold-based possessions. 

In choosing to focus on the role of gold for those involved in the production cycle of silk fabric, Joseph noted the common phrase that a sari goes "through a hundred and fifty hands."  She also observed that her field site provided a rich mix of participants from Hindu agricultures, Muslim workers involved in silk reeling and twisting, and caste-specific labor for weavers.  In situating the history of the silk industry, she reminded that it was already global when it was under the control of British colonial authorities, who were interested in capitalizing on sari production, as well as managing the relocation of workers in the silk industry.  Although Gandhian values of handwork and swaraj were still in evidence, the surplus generated by liberalization that could be highly disruptive with Chinese raw silk coming into the market and import tariffs being cut for mid-level entrepreneurs was generally invested in gold.  Based on surveys and participant-observation, Joseph collected many stories.  One informant described not eating for eight days and selling the gold owned by herself and her daughter to save themselves from debt so that her "ears are empty." Others moved from the labor back to the capital sector and doubled their gold holdings in the process.  She also found women using microfinance loans to buy gold that was then pawned to send money back to her village so that she could serve as a lender.  In short, Joseph gound capitalists able to hold gold ended up in a better place, while the gold economy could keep workers in debt.

"Banking with the Patron: the Case of Patron-Client in Makassar, Indonesia" by Tiar Mutiara Shantiuli and Salmah Said describes hierarchical financial arrangements in a range of occupations, including cowhide crackers, proprietors of rental game centers, food hawkers, sea cucumber divers, and fried shallot producers.  Shantiuli focused on how patron-client reciprocity was introduced and how working arrangements were structured as well as initiated.  She noted that recruitment through kinship, neighborhood, or faculty mentorship shaped the hierarchy of patron-client relationships that generally began with borrowing in exchange for help.

Global finance, political Islam, and traditional cultural norms all played a role in "Mobilizing Religion as Value Storage: Islamic Microfinance in Bangladesh as a Model for Poverty Alleviation?" by Bridget Kustin.  Kustin presented a framework that focused on how Islam was being developed as a store of value in which particular forms of religious and economic subjectivity were inculcated, often through specific pedagogical interventions.  Her work focused on the Islami Bank Bangladesh Limited and its relationship to a complex ethics around financial participation in which Islamic microfinance existed in relationship to zakat (mandatory charitable giving), sadaqat (voluntary charity), and waqf, which was established by an individual owner of immovable property to fulfill in perpetuity any function deemed legitimate in Islamic law.  By focusing on the question "of how people self-identify as poor" and potential conflicts with how institutions make such distinctions, Kustin hoped to offer a richer picture of how people viewed their economic realities.  She also situated her work in existing scholarship about prohibitions against riba (usury/interest), especially Bill Maurer's book on Mutual Life, Limited: Islamic Banking, Alternative Currencies, Lateral Reason that noted that the term did not technically designate interest but rather "increase."  At the same time banks that promoted Islamic ideologies also had to consider the potential harms of non-engagement and the opportunity costs to investment, even as they tried to be scrupulous about avoiding gambling or trade associated with taboo behaviors designated as  haram.  She described how global Islamic finance was supposed to promote social justice, grow assets rather than money, and foster equity and the sharing risks.  She also was interested in the escatological implications of how people thought about money in relationship to time and to the future.  Among those with resources, they declared that "God will demand accounting of me," while clients without means might refer to how "God knows my suffering," and that all experiences could somehow be reconciled in a holy account book

According to her interlocutors, questions of intent were critical.  Making intentionality explicit might also play a role in the global rhetoric of Islamic finance represented by documents such as the IBBL Mission statement.  All of these factors were complicated by conflict over political Islam in the country, including contestation about war crimes tribunals dating to offenses committed during the war between Pakistan and Bangladesh in the 1970s.  To provide more nuanced analysis Kustin chose Cox's Bazaar as a diverse field site that was multireligious and also showed how a stronghold of stronghold of Jamaat-e-Islami might include many supporters who were not radicalized and may pursue low-interest Islamic financing mechanisms purely for pragmatic reasons.   She also emphasized possible conflicts between the female empowerment favored by the Grameen Bank and the family uplift paradigm favored by Islamic microfinance.

"How does Mobile Money Affect Adopters' Social Networks?" by Alfredo Burlando, Cynthia Kinnan and Silvia Prina planned to study so-called "spillover" effects with a specific mobile money product, EZY-Pesa, which was developed through a partnership with carrier Zantel.  Researchers planned to focus on consumption smoothing, investing in health and education to reduce the shocks described by earlier presenters, and starting or improving income-generation activities.  Kinnan acknowledged a significant body of literature showing the mixed results of microcredit (Cerpon 2011, Augsburg 2012, Angelucci 2013, Attanasio 2011, and Banerjee 2013).  Furthermore, she said that she would not assume that if spillovers of savings existed that they would necessarily be positive, given the fact that people might avoid kin taxes (Townsend 1994) or shield cash from members of their social networks (Ligon 2002), much as earlier presenters depicted how Somali migrants used banks outside their own migrant communities.  The researchers also noted that these effects could be magnified by mobile savings.

With EZY-Pesa, they found that 50 households sign up per area on average and were able to create an experiment with 1700 recruited individuals.  The informed consent process also explained to those enrolled that they had a 50% chance of receiving help.  Thus, as Burlando elaborated the experimental conditions, half of the customers would receive marketing visit with Tsh 200 (about $1.25) placed in an initial deposit, while the other half would receive Tsh 2000 in cash with no assistance or advice.  As they progressed with the study, questions about trust were emphasized in the data collected via PDAs.  Researchers looked for four names and tried to identify altruistic and obligatory ties.  Then they asked interviewees to speculate about what they would do if they received a surprise payment.  Subjects ranked who they would want to keep this secret windfall from, from most to least urgent.  In their initial findings, they noted that obligatory ties tend to be rated at the same level of wealth and that altruistic ties tended to be close relatives likely to be in lending relationships.

 Discussant: David Pederson, UC San Diego focused his initial questions on the assumption that "value" and "wealth" were really interchangeable and pointed out that the papers showed that this relationship was not necessarily as stable as it appeared to be in vernacular speech.

Liz Losh's Guest Blog: Design is More Than Copy and Paste

In the final panel of the annual IMFTI conference on "Mobile Money: Lessons for Microfinance and Design" moderator Paul Dourish emphasized how the shift in thinking from "user-centered design" to "design-centered use" could be applied to mobile money systems. (The video above shows mobile phone operated vending machines in China.)

The first talk on the "Impact of Mobile Money Services on Microfinance Institutions by Patricia Pulido, Maricruz LaCalle, and Casey Conzett focused on an analysis of operational costs in Tanzania, where they said mobile money services were not developed despite the entry of companies like TIGO and Vodacom in the market and a growing role for microfinance institutions that emphasize small-scale finance. Researchers studied 37 institutions all over the region, which included places like Mufundi Community Bank, Njombe Community Bank, or Tandahimba Community Bank. They interviewed general managers, loan officers, and other bank personnel and identified a number of reasons that mobile money might be appealing, including "flexibility to adapt to client needs" (44%), "greater outreach to rural areas" (30%), "new sources of revenue by commissions" (30%), and a "greater number of clients" (15%). They also cited difficulties when electricity was unstable or the network slow, problems with training and marketing existed, or forced loyalties restrained consumer choice. Although they lamented limitations of time and acknowledged that "the field is not a laboratory," they pointed out that this was also highly original research given current literature reviews.

Speakers Panthea Lee and Zack Brisson of Reboot presented a design-savvy talk about "Value Systems in China: A User-Centered Approach to Designing Inclusive Second-Generation Banking." (Brisson was formerly active in the anti-genocide organization Enough.) In leading off his talk, Brisson joked that it was "almost as scary talking to a room full of anthropologists as it is to talk to a room of psychoanalysts." He described ReBoot as devoted to "getting to better research results" by understanding "lives and contexts" and the fact that "process maters." In focusing on China as a region of interest with an economy that was "literally skyrocketing," he argued that it was important not to forget the "many left behind" by "exacerbated economic inequality. Now, he insisted "innovation is possible" if it aims at "an inclusive, second-generation banking system. Brisson argued that China was a particularly likely area in which the unbanked could become banked through mobile money, because 70% of the population used mobile phones, remittances already shaped financial practices, and there were many existing agents. Like M-PESA in Kenya, there was also a clear vision for partnership between the telcom and the financial institution, as in the case of China Mobile and Shanghai Pudong Development Bank. Although these technologies may follow different uptake patterns, "desire for financial stability is universal."

Brisson and Lee described the core of their methodology as ethnography. Their study of study of mobile money focused on 4 cities and 6 towns and villages across a cross-section of the country. During a period of three weeks they conducted 113 interviews in the context of homes, places of business, or communal gathering points. The study relied on both unstructured and structured interviews and observations of direct service use in sectors such as health care and travel. As they explained, after unprofitable rural banks were closed as a result of market reforms, there was a strong need for mobile money to improve access to financial services. They noted that migrant populations were another important factor in the economies that they studied and that such Chinese often treated as another commodity, although they contributed to half of the nation's GDP and worked much needed high-risk, low security jobs. Furthermore, the marginalization of minority populations could create more obstacles to financial inclusion for certain segments of the unbanked, such as herdsman who had been forbidden from raising livestock by the authorities. (Older parents may have been compensated for the loss of their livelihoods, but children were not eligible for these government payments.)

Lee and Brisson emphasized three main themes:

1. Trust, defined by the in-group tendencies of kin, caste, or geography
2. Uncertainty, which might cause some to choose to forgo the risks associated with pursuing wealth. (As one couple said of their lives under Mao, "We knew we were poor, and would continue to be poor. That's better than not knowing where we will be tomorrow.")
3. Touchpoints

Lee and Brisson argued that it was necessary to design for agents, intermediaries, and influencers, not just end-users and to focus on trust, networks, and relationships. (Those interested in this approach may also want to check out the "infomediaries" research of The Global Impact Study and the work of François Bar.) For more about the work of Lee and Brisson in China, see ReBoot's blog posting on "Mobile Money in the Land of Mao."

"Best Practices in Mobile Microfinance" by Fatima Yousif, Elizabeth Berthe, and Olga Morawczynski provided a global overview of how the technology was being adopted in multiple countries. As Yousif explained, although MNOs focus on quickly profitable services, MFIs have to focus on the hard-to-reach and difficult-to-profit from. In their study an online survey was sent to over 100 microfinance institutions, and the group also conducted direct interviews of 16 MFIs, mostly in Kenya 16 MFIs, with the aim of addressing the relationship between "industry and us" and the "need to address real needs." By focusing on areas like low agent penetration, the group was able to examine social and commercial sustainability. Socio-cultural complications and research challenges are inevitable when mobile phones are frequently shared, there are problems with checks and controls, and there are low literacy levels. Yousif noted that in Cambodia low-end phones might not able to read Khmer script, and that there may be other complications in countries with citizens who have low literacy levels in own language to begin with relying on text applications. She also observed that there may be situations in which it is still less expensive to travel to a bank than to use mobile payment services, so newer technical solutions weren't always welcome. She said that it was surprising to see how few institutions did cost-benefit analyses, and how many providers assumed that there was no need for market research, because a particular approach was "obvious." In a market dominated by money transfers, where mobile network operaters know they can make the most profit, innovation was often hampered by pre-existing assumptions and the fears of stakeholders. For example, loan officers feared losing their jobs if new technologies were adopted. She also pointed out that the success of M-PESA was "both good thing and a bad thing," and she cautioned against "copy and paste" approaches in other regions. Certain factors may be "necessary but not sufficient," particularly in markets that are urban and peri-urban. She argued that "IT/MIS integration is one of the greatest challenges faced by MFIs today," a problem exacerbated by top-down decision-making.

She closed with a number of recommendations, which included "understand your market environment," "communicate, communicate, communicate," "invest time in developing your distribution network," and "test and monitor your product," because "new uses will come up." Her recommendation to "collaborate with regulators" proved to be the most controversial piece of advice during the question and answer session that followed.

As moderator Dourish asserted, "HCI not about interfaces but about relationships between design and use" and "producing designed effects." In answering his own question about where the sites of innovation might be, he emphasized the importance of "temporalities of innovation" and "directionalities of innovation." He also noted that "operator selection" was a "design decision in its own right."