Mobile Money: The First Decade - NEW white paper

By Stephen C. Rea and Taylor C. Nelms

"Mobile Money: The First Decade" White Paper - 34pp.
IMTFI Fellows Jude, Sangaré and Kusimba at Day 3 Workshop (2014) 

Over the past decade, mobile phone-enabled financial services, such as those made famous by the Kenyan mobile money platform M-Pesa, have been heralded as a means of poverty alleviation and financial inclusion. The mobile platform represents an exciting possibility as a delivery channel for digital financial services and as a technology that, like money, connects people with one another. Indeed, mobile money has thus become a central pillar of a global and internally heterogeneous—although by-now mostly “market-driven”—financial inclusion agenda, bringing together many different stakeholders in international development and philanthropy, industry (including telecommunications, banking, technology start-ups, and more), multinational aid and regulatory organizations, government, and academia.

Yet mobile money deployments around the world have not had unequivocal success. In this working paper, we survey lessons from the first decade of research into mobile money, focusing on an archive of studies produced by fellows funded by the Institute for Money, Technology & Financial Inclusion (IMTFI), based at the University of California, Irvine. We specifically target insights about mobile money users’ everyday social, cultural, political, and economic practices. We suggest that the ethnographic sensibilities of mobile money researchers have enabled attention to mobile money’s real use cases, while demonstrating how those use cases are context-specific and dependent on material, political, and sociocultural conditions that are often not replicable. At the same time, however, this literature has been characterized by a lack of systematization and comparative insight. Often explicitly aspiring to replicate and scale specific innovations, mobile money professionals (like those in across the development world) make constant use of comparisons across contexts. Many of these comparisons mobilize categories familiar to social scientists: culture, history, locality, inequality. We see the case studies produced by IMTFI researchers as contributing to an explicitly collaborative project that lays bare these assumptions of comparability, as well as their limits. It is our hope that this synthesis will be beneficial for mobile money’s various stakeholders.

Mind Your Ps and 2s

We describe mobile money’s primary use case—P2P money transfer—and argue that both the “Ps” and the “2s” of this model (mobile money’s “peers” and the technological and social infrastructures that intermediate them) must be understood in context. We find that the complexities involved in introducing and scaling mobile money, shared across contexts, resist distillation and are not going away. They include infrastructural maintenance, liquidity management, and coordinating interaction among all of the people in the system, from users to agents to service providers to regulators. From a practical perspective, we insist that such complexities are best thought of not as “pain points” to be bypassed or “frictions” to be smoothed over, but challenges to be carefully and regularly attended to in ways that put history, culture, and politics front and center: not as buzzwords, but as windows onto the variables that make a difference—differently in different times and different places—in shaping uptake and use of both money and technology.

Insights from the Research Archive

In what constitutes the bulk of this paper, we outline ten insights from the IMTFI research archive that demonstrate these contextual complexities. These insights have to do with:

• agent networks; 
• physical infrastructure; 
• location, place, and space; 
• kinship and family; 
• gender and gender inequality; 
• class, caste, and rank; 
• religion and ritual; 
• time and tempo; 
• government and regulation; and 
• the persistence of both cash and non-currency stores of value. 

If indeed the comparative categories of social science—history, culture, and politics foremost among them—are now being embedded in the strategies, operating procedures, and even self-presentation of global development, then it’s up to us to specify the contours and content of those categories. For each, we attend to the gaps between the hopes for and realities of mobile money’s impact thus far, as well as some of the fissures that have emerged among mobile money’s different stakeholder groups.

Concluding Thoughts and Provocations

We conclude by raising issues that promise to be critical provocations for the next decade of mobile money research, making an argument for methodological diversity, and interrogating the limitations of the “financial inclusion” frame within which mobile money has been situated as a development intervention. If mobile money is, at its core, a technology of communication and circulation, it is also a central means of distribution and redistribution. What would it mean, then, to shift the conversation from debates over financial inclusion to questions about financial justice?

Read the full white paper: "Mobile Money: The First Decade" - (34pp.)

IMTFI Fellows Day 3 Workshop (2016)
View Flickr stream for more photos of and by IMTFI researchers

***
Read previous installments of the PERSPECTIVES blog series on Financial Inclusion:

• Can financial inclusion be synonymous with financial justice and equity?
• Reflections on the “Financial Inclusion of the Poor,” workshop in Karachi (Part One): Decolonizing Financial Inclusion
• Reflections on the “Financial Inclusion of the Poor,” workshop in Karachi (Part Two): Decolonizing Financial Inclusion
• Drama in the payments infrastructure and saturation in financial education: Discussing new avenues of research around financial inclusion in Colombia
• Continuing the conversation about “financial inclusions” in Latin America – onto Mexico

We invite you to send comments to imtfi@uci.edu.

Review Post: Monetary Practices of Traditional Rural Communities in Ethiopia: Implications for New Financial Technology Design

By IMTFI Postdoctoral Scholar Ursula Dalinghaus

In this blog post I review an exciting new publication by IMTFI Fellow Mesfin F. Woldmariam, co-written with Gheorghita Ghinea, Solomon Atnafu and Tor-Morten Groenli. The article is based on Woldmariam's IMTFI supported research and appears in the journal, Human-Computer Interaction. The post ends with a brief update on Woldmariam’s latest research endeavors, together with IMTFI fellow Ndunge Kiiti.

In their path-breaking and provocative research article, “Monetary Practices of Traditional Rural Communities in Ethiopia: Implications for New Financial Technology Design,” the authors propose novel design applications for digital money and mobile money information systems with illiterate and low-literacy users at the focal point. Grounded in a fieldwork-based case study on the money practices of several village communities in Ethiopia, and in the context of religious and social practices, the authors make a case for incorporating peoples' existing practices and values into the design of dematerialized money forms. The authors, like many in the financial inclusion space, anticipate a time when all money is digital and no longer needs to be "cashed out" of an e-money system.

What challenges does this present, not only now but also in the near future, for rural populations like the low-literacy communities studied in Ethiopia whose techniques for managing and embedding money in social practices depend upon the material aesthetics of money? Cash money features—such as color for sorting value and visible piles to budget amounts—are important for navigating the daily use of money and in fulfilling religious obligations and social performances. Especially in the context of extending money gifts, the materiality of cash enables individuals to decide when money amounts should be hidden or visible, and even to refuse a money gift based on its source or moral quality (is it "clean" or "dirty?")

Rather than assuming a "one-size-fits-all" approach, the authors argue that these values and practices should be integrated into the design of new mobile money platforms. Failure to take local and population-specific needs and values into account will mean that illiterate users will be further excluded or may even reject the adoption of new technologies. While the authors are careful to connect their design ideas to the specific case at hand, they argue that similar types of needs can be found in many other parts of the world. More grounded research is therefore needed to ask the right questions in developing locally specific and context-appropriate e-money applications that support existing social practices. The larger and crucially important question the authors of this article raise is this:

"who gets to decide what 'value to people' looks like, what 'legitimate uses' of money are?" (p. 511)

The insights and applications presented here will be invaluable for professionals and researchers alike in the financial inclusion space, as well as for anyone interested in the qualitative design implications represented by digital money futures. (The full article can be accessed here)

In a blog post for IMTFI Woldmariam wrote early on about the importance of metadata and information in conceptualizing how material money might be translated into digital form. His case study on cash management techniques in Ethiopian rural marketplaces has also been featured in IMTFI’s Consumer Finance Research Toolkit.

Mesfin Woldmariam talks with smallholder 
farmers from a DigitalGreen Project

More recently, Woldmariam has been collaborating with IMTFI Fellow Ndunge Kiiti on a project supported by the Institute for African Development at Cornell University to assess mobile money awareness and use/usage among smallholder farmers in rural Ethiopia. This project places research and on-the-ground dialogue with smallholder farmers and other stakeholders at the beginning and forefront of potential design and implementation of new technologies. Drawing on their respective field experiences and areas of expertise, Kiiti and Woldmariam's work emphasizes the importance of carefully assessing and documenting smallholders' existing practices and needs to develop appropriate and empowering solutions.     

To read more about Mesfin Woldmariam’s and Ndunge’s IMTFI research, their project pages can be found here and here.

References

Mesfin F. Woldmariam, Gheorghita Ghinea, Solomon Atnafu and Tor-Morten Groenli
"Monetary Practices of Traditional Rural Communities in Ethiopia: Implications for New Financial Technology Design." Human-Computer Interaction. Volume 31 (2016): 473-517

Funny Money Roundup 2

Another roundup of funny money, courtesy of IMTFI research assistant Taylor Nelms:

• I’m currently doing research in Quito, Ecuador, and after being mugged on a previous trip, I started putting a folded $20 or $10 bill in my shoe to have a bit of cash for a taxi if it happens again.

Now I know what to call it. Learn about the history of “mad money.” (h/t Eva)