Mobile Money as demonstrated by M-PESA is the fastest and most cost-effective way to connect the poor to a savings account. The mobile platform can help in the innovation and marketing of new savings products that are economical for both the product providers and the poor. Savings are an integral component of financial inclusion since it not only helps people mitigate the risks posed by a unforeseen circumstances such as medical emergency or a bad crop; but it also gives them the ability to marshal their resources to build a brighter future for their families, allowing them to take the giant leap from reacting to events to planning for the future.
In this section we highlight articles, blog posts and other resources that operators might find useful when researching this topic.
1. Why are savings important?
Safe Places to Save
Author : The Bill and Melinda Gates Foundation2.5 billion people live on less than $2 per day. Most have no access to savings accounts. But now, new technologies are offering life-changing services to escape poverty.
A Penny Saved: How Do Savings Accounts Help the Poor?
Author : Jake Kendall, The Bill and Melinda Gates FoundationThis paper reviews the experimental evidence (both RCTs and natural experiments) regarding the impact of improved access to savings. While there are precious few pieces of evidence documenting the development benefits of formal savings services for poor households, the few rigorous studies that exist show savings accounts enhance the ability to save up for productivity enhancing investments and weather unexpected bad times.
2. How can mobile money help connect the poor to savings?
It’s time to address the microsavings challenge, scalably
Author : Bob Christen and Ignacio Mas, The Bill & Melinda Gates Foundation.This article elaborates on why savings is so important - and suggests how the microsavings model might work in practice. That is, what role each player, including mobile operators, banks and MFIs, might play in developing a system capable of delivering microsavings to all.
M-Kesho in Kenya
Author : Ignacio Mas, The Bill and Melinda Gates Foundation
In this post, Ignacio Mas, explains how M-KESHO creates an opportunity to offer a broader range of financial services seamlessly on the biggest mobile money platform in existence in the world.
3. Other Resources
Commitments to Save: A Field Experiment in Rural Malawi
Author : Lasse Brune et al. The University of MichiganThis paper reports results of a field experiment in Malawi that randomly allocated smallholder cash crop farmers to treatments facilitating savings in formal savings accounts.
Portfolios of the Poor: How the World's Poor live on $2/day
Author : Collins, Daryl, Jonathan Morduch, Stuart Rutherford and O.RuthvenThis book tackles the fundamental question of how the poor make ends meet. Over 250 families in Bangladesh, India, and South Africa participated in this unprecedented study of the financial practices of the world’s poor.
