This idea focuses on rural communities because modern financial products generally target urban-based consumers and because the concentration of people and resources within cities offers more potential avenues to financial empowerment. I propose using a combination of peer-to-peer training and phone-enabled tools in sequence so that a series of in-person workshops prepares – and qualifies – recipients to join a mobile platform.
I interpret the term “financial empowerment” as having two core definitions: 1) concrete pieces of information such as compound interest, tax structures, awareness of risk, insurance schemes, preparing a budget, managing a credit card, saving for retirement – education that can be communicated in distinct modules with the goal of building a skillset deemed financial literacy; and 2) experience – an understanding of how to navigate financial matters acquired through firsthand exposure. The distinction between these two components – “education” and “experience” – is helpful to explain how the two elements of peers and phones work in tandem to achieve the goal of empowerment.
When considering who needs financial empowerment the most within rural communities, I prioritize young people aged 15 to 30 because access to this assistance can drastically alter the life of an adolescent/young adult by facilitating, for example, a university education, a move to the city, or a specialized profession. Let’s imagine the end user as a farmer or factory worker making an average monthly wage of around $100.
With this target population in mind, we start with a peer-to-peer training structure. Through a series of workshops in small groups, an instructor outlines the main principles of a financial education (such as those mentioned above). As a way of simultaneously introducing a complementary lesson in the experience of financial empowerment, we could market the workshops as free of charge but require a deposit that is reimbursed upon successful completion of the whole curriculum. In other words, a refundable down payment to guarantee commitment – a means of articulating the contract that the recipient enters with him/herself by enrolling.
Who is the instructor? Initially, an NGO or other external party. This is necessary as a first step to lay a foundation of quality content and consistent teaching methods; however, as quickly as possible, the reins should be handed over to the recipients – to those being trained. After graduating, recipients who demonstrate mastery of the concepts are invited to train others in the community. This way, empowerment works on two levels: the recipient is empowered with education, and the recipient-turned-trainer is doubly empowered with status as an authority on financial literacy. These local trainers could call upon the NGO when needed, but the aim is to create a self-sustaining model.
For people aged 15 to 30 who may never have had a formal education previously, the recognition that comes with a trainer position can be highly inspiring. It becomes part of his/her identity and is a source of credibility that can result in significant behavioral change. This is where the power of rural communities plays a central role. Word travels fast when a growing group of people – friends, neighbors, co-workers – are in newfound possession of a valuable competency; moreover, the workshops could be held in public venues to enhance visibility. Ideally, peer-to-peer training would ultimately reach the majority of young people in the community.
What happens next? Phones. Human interaction is a vital and irreplaceable first stage, but it has its limits. Both the trainers and recipients would be participating in the workshops on top of their daily routines; realistically, we can only expect the in-person component to occupy a contained, concentrated period of time in their lives. A mobile platform serves as the subsequent phase to reinforce the education and create a dynamic marketplace of personal contributions – of experience sharing.
The means through which graduates enter the phone phase is key: access should be an earned privilege that comes with completing the workshops. The face-to-face training can be understood as the prerequisite for membership in the mobile network. Each graduate receives a unique login to join the mobile community; they are also presented with an affordable way to obtain a phone, if necessary, such as a staggered payment cycle that allows the cost to be spread across several months.
With this transition from peer-enabled instruction to phone-enabled exchange, empowerment shifts from a top-down linear approach to an organic, user-generated network.
What does the mobile platform contain? Any number of tools and resources, all made social. To name a few: an archive of workshop principles; headlines from local/regional financial news; a simple application for managing expenses; a Q&A forum; a transactional portal for small loans and transfers. Given that all participants would have graduated from the same foundational training courses, they enter this handheld sphere with a shared language to communicate – to communicate with people from their own community and also graduates in other geographies.
While smart phones of course allow for more meaningful engagement, this idea could still work with a basic feature phone. (The success of M-Pesa is testament to the creative potential of traditional phones thoughtfully integrated into a local context.) These days, smart phone hardware can be incredibly cheap; it’s the data plan that normally makes connectivity prohibitive for rural populations. This is where the likes of Facebook’s Internet.org initiative could serve as an appropriate partner to bring internet access to remote villages.
The nature of empowerment that comes with a voice on the mobile platform is distinct from the empowerment made possible through peer-to-peer training. There is an equalizing force that accompanies the move from in-person interaction to virtual interaction. The digital sphere in large part removes social barriers – of gender, religion, class – just as it removes physical barriers, liberating expression and democratizing access for groups that may feel marginalized in the flesh. With this form of phone-to-phone contact, it is interesting and helpful content that matters most; the particulars of one’s profile become secondary or altogether irrelevant.
This hybrid model of peers and phones seeks to improve the capacity of rural youth to obtain practical financial education and experience. It plays out in neighborhoods and on screens. From our perspective as planners, it offers opportunities both to observe behavior for qualitative insights and to measure data for quantitative ones.