Hu Gaoyan, a farmer in Anshun village in Guangxi province, is thrilled that his daughter has found a husband. But he is also anxious about her wedding expenses. With limited savings and no access to bank credit, Hu turned to the only lender he knows: Shen Xiaoyang, the village veterinarian.
In Anshun, the vet makes a natural choice for those seeking a gao li dai, or high interest loan. Shen offers access; earning more money than many of his neighbors, who are predominantly farmers and small shop owners, he can afford to make loans. He also offers convenience; in this corner of Guangxi, the community is dispersed across mountainous terrain. Shen makes house calls, traveling by motorbike to care for villagers’ livestock—and, if needed, bringing money to loan.
Most importantly, Shen offers trust. Like most residents in Anshun, his family has been in the … Read More »
Two years ago, Xu Hanping and Gao Jianjun arrived in Shijiazhuang with the clothes on their back and a mission: find a laoban.
They had heard from a friend that a laoban from their same small village in Sichuan Province was working there. They needed to find him. For migrant workers like Xu Hanping and Gao Jianjun a laoban meant a connection to coveted construction jobs, and their only sure shot out of a livelihood of subsistence farming.
Laobans are managers and middlemen. They arrange contracts with employers and then take responsibility for recruiting and overseeing hundreds of temporary workers. Laobans are often connected to their workers by only a few degrees of separation, even hailing from the same village, as in the case of the laoban Xu Hanping and Gao Jianjun were seeking.
The foundation of most migrant workers’ sustenance is their … Read More »
In the jostle for tickets at the Beijing Railway Station, Zhang Qi never felt the knife that slit his jacket open. In a flash, a thick wad of cash had been lifted from his pocket. It was more than RMB 5,000 ($800)—his entire years’ savings.
Zhang Qi is a migrant worker. He is among a floating population of 250 million strong with no legal status that has been the backbone of China’s incredible growth story. Migrants like him have flooded booming Chinese metropolises in a search of economic opportunity, transforming a country of isolated cities into one of tethered, transient networks.
But access to financial services has not kept pace with this increasingly transient population. Many migrant workers lack even the most basic means to save for their children’s education, make purchases on credit, protect their homes through insurance, and send and … Read More »
On January 18, for the first time in over a decade, China released official figures on economic inequality.
Even the government is calling the wealth gap “relatively large.” Part of the problem is that China’s incredible growth story is overwhelmingly urban. City residents currently earn on average three times as much as their rural compatriots.
But an important corollary is that financial access has not kept pace with an increasingly transient population. As hundreds of millions of migrant workers flood Chinese cities in search of opportunity, they lack even the most basic means to save for their children’s education, make purchases on credit, protect their homes through insurance, and send and receive money. Financial exclusion prevents many of them from realizing their potential and improving their livelihoods
With the support of the Institute of Money, Technology, and Financial Inclusion, Reboot undertook a … Read More »
Recently, Fidelity Bank announced that they are using susu collectors in Ghana to improve service delivery and reach, and equipping them with point of sale terminals for real-time reconciliation. This is a prime example of how a formal financial service provider can tap into informal networks.
Susu collectors are one of the oldest financial services in Africa. They are traditionally trustworthy people who visit clients in their communities to collect very small deposits over the course of a month. At the end of the month, the susu collector returns the accumulated savings to the client but keeps one day’s savings as commission. Susu collectors occasionally provide advances to their clients. The formal financial sector in Ghana became interested in susu collectors years ago, and private-sector banks such as Ghana Commercial Bank and Barclays used susu collectors to mobilize savings and … Read More »
We’ve recently featured a series of posts about our branchless banking work, including posts on branchless banking in Pakistan, better development through mobile banking, and designing financial inclusion. Recognizing that some of these concepts are not yet commonplace, we thought we’d offer our perspectives on them. This post will focus on branchless banking terminology, but we plan on offering explanations of other concepts in the Reboot domain in the next few weeks. These definitions are gleaned from our own understanding and from previous posts on Reboot Ideas. If you’re curious about a term or idea you dont see below, please comment in the space below or send us a tweet (@theReboot).
To anyone living in the US, it may seem like there is an overabundance of banks and financial services. In parts of New York City, banks are as ubiquitous as Starbucks. Throughout the US, credit card offers arrive in the mail almost daily. Yet, in other parts of the world (and in certain parts of the US), a large swath of the population is excluded from these financial opportunities. Many of the world’s poorest live without access to basic financial services such as savings, insurance, payment services, and basic credit….
Good field research starts with a focus on training. This ensures that the entire team, including new local staff, fully grasp and support project goals. This shared understanding is critical to the ability of each team member to effectively execute his or her responsibilities. This is true everywhere, but the importance of training and buy-in increases in direct proportion to the authoritarian-ness of the local government. In contexts where asking an unbefitting question can lead to a visit from national security, or an invite for a less than pleasant ‘cup of tea’, local team members are understandably wary of missions they don’t thoroughly understand.
Our current project in China is no different. Thus, our team in China has spent much of the last week between Beijing and Hohhot training our crack local staff on project vision, goals, and the broader ‘why this stuff matters’.
A Reboot team recently returned to Pakistan, where we are supporting the efforts of a bank to expand access to basic financial services to those in need. We recently presented the project findings from our recent field study in Punjab Province to the bank’s management and staff. Some of the resulting design recommendations addressed how the bank could:
- Enhance delivery mechanisms for humanitarian relief funds and government-to-person payments.
- Graduate aid beneficiaries into viable branchless banking customers.
- Strengthen its business model through selective, strategic investments.
- Better serve marginalized market segments, defined here as rural populations, the poor, and women.
The team also led a series of interactive workshops with each of the bank’s functional areas, where staff at all levels were encouraged to test, challenge, and build upon our findings, and to develop concrete next steps towards improving their branchless banking services.
For some researchers, travel in insecure regions or the mid-project client check-in are the most nerve-wracking parts of a field study. For me, it’s recruiting the local team. Going in to each study, we know the what’s, why’s, and high-level how’s regarding the data we seek. The actual on-the-ground how-to’s, however, require the input of shrewd local researchers. Without the right field team, a study is doomed before it’s begun. This was no less true for our work in Pakistan, where a Reboot team has been doing research and analyses around how to achieve greater financial inclusion through sustainable market-based approaches. Friends old and new rallied for our cause and we now boast an exceptional Pakistani team. To Irfan Kareem and Uzma Aziz, this post is to you.
But how do you take seven relative strangers from four countries — an inclusive finance expert, an agricultural economist, a gender reform specialist, a sociologist, an interaction designer, a systems analyst, and a design researcher — and rapidly unify them in vision, purpose, and action?
Those that follow this publication know that Reboot is passionate about improving the nature of transactions between citizens and the institutions meant to serve them. From Egypt to the United States to China, we are looking at how these interactions are changing, and how to design that change in a way that leads to improved outcomes.
This focus has led us to Pakistan, a country roughly the size of Chile that generates a disproportionate share of the world’s grim headlines. While we’ve only been here for under a week, our time thus far — spent between Karachi and Islamabad — belies the negative narrative dominating global consciousness. Pakistan certainly has a history of painful strife, yet there are countless reasons to be optimistic about its future. For one, the Pakistani government is serious about expanding access to basic services for a population that has been battered by conflict, natural disaster, and economic despair. For another, there is an able and sizable middle class eager to help steer their country towards positive growth.