The power of mobile phones in inspiring financial inclusion

A woman uses her phone while selling bananas.

Photo credit: File I Nation Media Group

What you need to know:

  • One of the ways in which women’s exclusion is tackled is economic empowerment. And one route towards this is business.
  • From an even narrower perspective are the tools used for enhancing participation in business.

The campaign theme of this year’s International Women's Day is “Inspire Inclusion”, justified on the basis that this helps to forge a better world.

“Inclusion” has become a buzzword in recent years because of the concern that certain categories of people are often discriminated against unless deliberate preventive measures are taken.

It is also based on the fact that the human population is diverse on several axes such as sex, age, religion, political opinion, health status, disability, and sexual orientation. The quest for gender equality itself is informed by the fact that women have been targets of discrimination over centuries.

One of the ways in which women’s exclusion is tackled is economic empowerment. And one route towards this is business. From an even narrower perspective are the tools used for enhancing participation in business.

In this regard, mobile telephony comes to mind. Just how does this tool aid women in conducting their informal businesses? This is the gist of a study titled “Utilisation of mobile telephones by women in support of informal business in rural and urban markets in Kiambu County – Kenya”.

Carried out by Elishiba Kimani and Hilda Makhamara, the study is published in Kenyatta University’s Women’s Economic Empowerment Hub’s inaugural journal that was released late last year.

The overall objective of the study was to establish how women in informal business utilised mobile telephone technology to achieve increased economic empowerment. Its point of departure is that today’s is a world in which technology has become a panacea for various human endeavours.

The study is also anchored on Sustainable Development Goal 5, which is purely on gender equality and empowerment of women and girls.

The few studies on this subject demonstrate that the mobile telephone is the most accessible form of information communication technology within the informal sector, and one that enhances financial inclusion for traditionally neglected populations such as those in rural areas and informal sectors that are considered risky and inconvenient.

On the forms of mobile telephone functions used by women in the informal sector, the study established that M-Pesa (100 per cent), SMS (89 per cent), M-Kopa (89 per cent) and M-Shwari (83 per cent) were the most popular applications, followed by WhatsApp (61 per cent) and Pochi la Biashara (51 per cent). Businesswomen in urban areas were more frequent users than their rural counterparts.

The advantages women derived from using specific platforms, hence their choices, rotated around: ease of registration and use; linkage to formal banking services; usability without needing a smartphone; safety of funds; automatic recordkeeping of transactions; availability at any time and place; scope for advertisement of products; speed; and accessibility to more customers.

Common challenges associated with different applications included: infiltration by criminals; high transaction charges; restriction to smartphones (for some); dependence on literacy; and provision of specific services and not others.

One key finding was that the “use of mobile telephones made the informal businesses by women more efficient, cost-effective, and thus saved a lot of time while increasing their capital gains.”

The technology has substantially contracted space between the businesswomen and their customers, hence eased accessibility, and removed the inconveniences associated with use of cash.

It has also enabled women to save time and energy as they can conduct transactions without having to walk to banks, for example, and need not visit suppliers to order provisions.

Moreover, they also rely on deliveries by motorbike operators that are also paid through mobile phones. The time saved is invested in other pursuits, hence achieving higher daily productivity, liquidity and flexibility.

The women can also access capital through the platforms that run loaning services. And the fact that some of the platforms are interlinked has eradicated bureaucratic processes of registration and due diligence as the women’s particulars are already available to the telco via their registered phone numbers.

The study concludes that mobile telephony boosts women’s informal businesses and debunks the notion that technology is a male domain. The independence gained gives women high levels of confidence and enables them to expand their financial base and easily manage routines such as recordkeeping.

The study recommends investment in technological measures to prevent fraud, increase availability of mobile telephone functions that are operable by people with basic levels of education and ease of funds transfer from telephones to banks.

Although the scope of the study is limited, it demonstrates how simple measures can enhance inclusion and enable economic empowerment.

Telecommunication companies should consider sponsoring more of such studies, and nationwide ones at that, to generate information that would aid in improving their services.

Findings from such studies can help them co-create with their clients, of whom women are a substantial proportion.  

The writer is an international gender and development consultant and scholar ([email protected]).