IMTFI Blog: Mobile Money: The First Decade

By Stephen C. Rea and Taylor C. Nelms

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.)

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

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