| dc.description.abstract | Research conducted on the poor and their finances indicate that there is need to develop financial
instruments that specifically fit their needs. However, banks have not been able to provide such
services, because the returns don't justify the cost of delivering them. The uptake of mobile phones
and mobile money (in various guises) in the recent years has been tremendous and widely
documented. While the basic product is person-to-person money transfer, more sophisticated
financial products designed for the poor are now coming on line. This paper describes the experience
of Kickstart in Kenya designing, piloting, deploying and sustaining a mobile phone savings
application, leveraging the widely popular M-PESA money transfer service to target poor, small-scale
farmers. KickStart, a non-profit organization headquartered in Kenya, designed a "Mobile Layaway"
service that enables farmers to make mobile payments of any amount and of any frequency to
purchase human-powered irrigation pumps. The specific goal is to help farmers amass a lump sum
for a major equipment purchase (foot-pedaled water pump). After the pilot, the flexible and targeted
mobile-layaway program recorded over 95% success rate, with most farmers saving faster than they
expected, giving a lot of hope that such saving tools can actually provide a safer, more secure, and
more effective way to save for products and services. In addition, more women were able to buy
water pumps than without the savings program. This paper suggests that the success of Kickstart's
Mobile Layaway provides a template for other similar products targeting the base of the pyramid, and
draws lessons from the Kickstart pilot that may prove valuable for other mobile-money firms and financial service providers. The paper also presents two lessons learned in the design and
implementation of the mobile money product; that iterative mobile money product design is critical
for success and that simple solutions do overcome the issue of mistrust. It also makes some
conclusions and recommendations for further research work. | en |
