FREE ELECTRONIC LIBRARY - Dissertations, online materials

Pages:     | 1 |   ...   | 3 | 4 || 6 |

«bath papers in interna onal development and well-being ISSN 2040-3151 Compe ng visions of financial inclusion in Kenya: The ri revealed by mobile ...»

-- [ Page 5 ] --

The evidence for the use of MMT demonstrates that its use is more varied in terms of relationships and reasons for sending money than a simple logic of remitting funds to family and household or even extended family in rural areas. It appears instead to seamlessly facilitate a wide array of inter-personal transactions that are part of people’s financial lives and does this over distance in the context of a mobile population. This opens rather than closes the question of what the underlying logic of these transactions is. From Graeber’s perspective it is important not to over-interpret all of these as exchange relationships when some of the ‘gifts’ or ‘assistance’ may represent aspects of basic sociability – transfers that ‘would’ be returned if the need arose – donations in support of funerals, sickness, fundraising events of various kinds (e.g.

harambees) as well as occasional support at times of need may fall into this category.13 The boundaries between such basic sociability and exchange in which these transfers - appearing to go one way – in fact produce a reciprocal flow of support or assistance are therefore hard to identify. Some are entrustments which produce future obligations of resources as Shipton identifies for the Luo and some are clearly and straightforwardly inter-personal borrowing – but both appear to have at their core relations of equality.

Informal financial groups offer proximate liquidity which can be accessed either directly through the mechanism itself as a loan or re-timed payout, or indirectly through the social connections that people gain through them. This is not to suggest that elements of power dynamics are not at play in these groups (see for example Bouman 1995; Johnson and Sharma 2007). Even if people do not always repay in the time frame set, ‘delays’ are not the same as default and continue rather than end relationships. Their logic is to circulate funds in ways that benefit members and they also go beyond to have elements of additional support through welfare funds which respond to need. The language is of contributions and the social connections allow for The reciprocity approach has been extended to social insurance and the idea of “conditional reciprocity” (Platteau 1997) but while membership of groups where insurance does take place, there are levels of assistance that are not so clearly codified in this way.

16 | P a g e Competing visions of financial inclusion in Kenya: the rift revealed by mobile money transfer Johnson “negotiability” in access to resources seeming to operate in a strong framework of equality (see also Johnson 2004).

The social relations of resource access and use for these two services stand in stark contrast to the relational dynamics of banks. In this case the entrustment of deposits to them results in, at best, the obligation that the amount is returned less a withdrawal fee. Interest is effectively irrelevant on balances of the level held due to higher inflation rates. But the difficulty of gaining loans through them means that the evidence confronting poor people is that a relationship with a bank is not a dynamic system of exchange in which funds are lent in both directions. The bank does not therefore represent a social relationship of equality and a means through which social connections are developed in ways that offer access to resources.

Further, the politics of the banking system has in the past been identified with the wealthy political elite leading to instability and failure (Brownbridge 1998; Ogachi 1999). Regulatory and supervisory improvements have now produced stability (Beck, et al. 2010; Upadhyaya 2011) but a system that is still oligopolistic in its structure with the majority of assets concentrated in a small number of government-owned or influenced, and foreign-owned banks. Banks as a result continue to be popularly understood as affected by political influences in the context of Kenya’s on-going political dynamics.

Equity Bank has been instrumental in changing the perspective of the banking system on the scale and scope of the low income market, has changed the charging structure (see above) and had a focus on lending which has helped lead to its popularity and increased client base. This in turn must be understood in the context of its origins in Central Kenya under Kikuyu-ownership during the period of Kikuyu opposition to the Moi government prior to 2002 when resources flowing to this area were reduced, in particular, from Government-owned banks. Equity’s Kikuyu identification has developed since 2002 with Kibaki’s government although it has also sought to address this through its staffing, board directors and branch expansion. 14 But despite its focus on the low income market, it has nevertheless not yet delivered a proposition that completes on the lending side of the exchange dynamic for the majority of poorer people. Critically, then the possibility that lending a few hundred shillings to a bank yields an exchange or reciprocal obligation is entirely absent and also leaves no scope for negotiability to operate. By contrast, the history of banking in Kenya suggests that banks do operate this way for particular rich and politically connected elites.

From this perspective therefore, financial groups and MMT operate within social relations of equality. For low income people banks behave in a manner that is more hierarchical in nature, or, as a respondent in an earlier piece of research put the emphasis on their power in the Indeed, the recognition of the alignment of Equity Bank with the Kikuyu led Kibaki Government is noted in (Morawczynski and Miscione 2008) and in the wake of the post-election violence of 2008 Equity’s opening of a branch in the home district of the opposition leader Raila Odinga was particularly symbolic in seeking to heal the political divide (see http://kenyapolitical.blogspot.co.uk/2008_05_01_archive.html accessed 21/03/12).

17 | P a g e Bath Papers in International Development and Well-Being Paper Number 30 relationships: “mountains move!” [Johnson 2004]. Thus, scope for negotiability is different and the boundaries between equality and hierarchy in debt relations in the contemporary Kenyan context are brought into view. The use of banks for payments underlines the point. The trust required to utilise a payments system is much shorter in terms of time horizons than that required in institutions for longer term saving or accumulation – it is more akin to the situation of barter in which enduring ties are not established (Peebles 2010). Indeed, MMT is being used in a largely similar way and raises the question as to whether MMT does in fact have the potential to become a recipient rather than simply a conduit for funds.

6 Conclusion Within the context of literature that calls for new understanding and analysis of money, debt and financial practices, and a policy emphasis on financial inclusion, this paper has examined the financial transactions of low-income people in Kenya in their use of MMT and compared them with financial groups and banks focussing on the social relations involved. Graeber’s perspective is on the contrast between equality and hierarchy in these relationships and problematic definition of debt as part of an exchange relationship which operates in the “shadow of equality” when hierarchical relationships ultimately backed by power and violence are in fact at work.

Berry’s perspective on African “negotiability” and its origins in institutions, whose bases are open to the shifting sands of social relations and meaning, highlights both the logic of developing social connections in order to secure access to resources but also the ever present need to identify their limits.

Together these offer insight into the financial practices underlying the use of these three services and shows how they operate on different social relational dynamics. MMT has allowed relationships of exchange between equals to occur much more cheaply and efficiently, even extending the potential for social connections and negotiability to be developed. This allows new routes to resource access to be developed and sustained, especially over greater distances through the cultivation of relationships with extended family and friends as well as more immediate family. While this expands the opportunities for access to resource transfers in the face of idiosyncratic shocks, the dynamics of these relationships are more open-ended and varied and cannot therefore so easily be reckoned in terms of insurance. This therefore offers a dimension of analysis far beyond the simple remittances story. Financial groups engage in a similar dynamic although are a more structured basis of equality and provide routes to negotiability in resource access.

Banks by contrast give little evidence to poor people that these relationships are equal – debt extended to banks in the form of deposits by poorer people are not returned in equivalent value, and nor does this debt flow in both directions. Indeed, the preference of banks for salarybased lending in which they can directly control the means of repayment further confirms their risk aversion and failure to engage in direct building of relationships with borrowers who do have control over their means of repayment. Hence they do not enter into the landscape of social relations with negotiable dimensions but present a boundary which the history of banking

–  –  –

and its relationship to political elites suggests is better understood as having elements of hierarchy. This further explains their heavy use for payments rather than savings. This analysis also underlines the importance of these social dynamics as investments in themselves which also engender economic resource mobilisation in contrast to the view that they are necessarily suboptimal and a drain on resources.

This analysis suggests that policy efforts towards financial inclusion which seek to lower transactions costs and which seek to ‘nudge’ people towards ‘savings’ services operate on an etic vision which is at odds with the emic vision revealed here and will therefore encounter this ‘rift’ in social relations. While mobile money transfers may create the infrastructure for payments services through reduced transactions costs, this research suggests that neglecting an understanding of the social relations within which they actually operate is likely to render the ambitions of financial inclusion policy a more challenging goal.

–  –  –

References Aker, J. C. and Mbiti, I. M. 2010 'Mobile Phones and Economic Development in Africa', Journal of Economic Perspectives 24(3): 207-232.

Anderson, S. and Baland, J.-M. 2002 'The Economics of Roscas and Intrahousehold Resource Allocation', Quarterly Journal of Economics CXVII(3): 963-995.

Banerjee, A. V. and Duflo, E. 2011 Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty, New York: Public Affairs.

Beck, T., Cull, R., Fuchs, M., Getenga, J., Gatere, P., Randa, J. and Trandafir, M. 2010 'Banking Sector Stability, Efficiency, and Outreach in Kenya', Washington DC: World Bank Policy Research Working Paper 5442.

Beck, T., Maimbo, S. M., Faye, I. and Triki, T. 2011 Financing Africa: Through the Crisis and Beyond, Washington DC: World Bank.

Berry, S. 1993 No Condition is Permanent: The Social Dynamics of Agrarian Change in SubSaharan Africa, Wisconsin: University of Wisconsin Press.

Bohannan, P. 1959 'The Impact of Money on an African Subsistence Economy', The Journal of Economic History 19(04): 491-503.

Bouman, F. J. A. 1995 'Rotating and Accumulating Savings and Credit Associations: A Development Perspective', World Development 23(3): 371-384.

Brownbridge, M. 1998 'Government Policies and the Development of Banking in Kenya', in M.

Brownbridge and C. Harvey (eds) Banking in Africa, Oxford: James Currey.

Brune, L., Gine, X., Goldberg, J. and Yang, D. 2011 'Commitments to Save: A Field Experiment in Rural Malawi', Washington DC: World Bank Policy Research Working Paper No 5748.

Duflo, E., Kremer, M. and Robinson, J. 2009 'Nudging Farmers to Use Fertilizer: Theory and Experimental Evidence from Kenya', National Bureau of Economic Research Working Paper Series No. 15131.

Dupas, P. and Robinson, J. 2013a 'Savings Constraints and Microenterprise Development:

Evidence from a Field Experiment in Kenya', American Economic Journal: Applied Economics 5(1):


— 2013b 'Why Don't the Poor Save More: Evidence from Health Savings Experiments', American Economic Review 103(4): 1138-71.

FSD Kenya and Central Bank of Kenya 2009 'Results of the FinAccess National Survey: Dynamics of Kenya's Changing Financial Landscape', Nairobi: FinAccess and Financial Sector Deepening Kenya.

— 2013 'FinAccess National Survey 2013: Profiling developments in financial access and usage in Kenya', Nairobi: FSD Kenya and Central Bank of Kenya.

–  –  –

Geschiere, P., Goheen, M. and Piot, C. 2007 'Introduction: Marginal Gains Revisited', African Studies Review 50(2): 37-41.

GPFI and CGAP n.d. 'Global Standard-Setting Bodies and Financial Inclusion for the Poor: Toward Proportionate Standards and Guidance', Washington DC: GPFI and CGAP.

Graeber, D. 2011 Debt: The First 5,000 Years, New York: Melville House.

Granovetter, M. 1985 'Economic action and social structure: the problem of embeddedness', American Journal of Sociology 91(3): 481-510.

Gugerty, M. K. 2007 'You Can't Save Alone: Commitment in Rotating Savings and Credit Associations in Kenya', Economic Development and Cultural Change 55(2): 251-282.

Guyer, J. I. 2004 Marginal Gains: Monetary Transactions in Atlantic Africa, Chicago and London:

University of Chicago Press.

Hart, K. 1986 'Heads or Tails? Two sides of the coin ', Man 21(4): 637-656.

Hart, K. 2010 'Informality', in K. Hart (ed) The Human Economy, London: Polity Press.

Heyer, A. and Mas, I. 2011 'Fertile grounds for mobile money: Towards a framework for analysing enabling environments', Enterprise Development and Microfinance 22(1): 30-44.

Ivatury, G. and Mas, I. 2008 'The Early Experience with Branchless Banking', Washington DC:

CGAP Focus Note No. 46.

Jack, W. and Suri, T. 2011 'Mobile Money: The Economics of M-PESA', Massachusetts, USA:

National Bureau of Economic Research Working Paper Series 16721.

Pages:     | 1 |   ...   | 3 | 4 || 6 |

Similar works:

«TRANSFORMATION OF NATO IN THE FACE OF TRANSNATIONAL TERRORISM A Master’s Thesis by SEBAHAT BULDUK Department of International Relations Bilkent University Ankara September 2009 To my parents and Ertuğrul TRANSFORMATION OF NATO IN THE FACE OF TRANSNATIONAL TERRORISM The Institute of Economics and Social Sciences of Bilkent University by Sebahat BULDUK In Partial Fulfillment of the Requirements for the Degree of MASTER OF ARTS In THE DEPARTMENT OF INTERNATIONAL RELATIONS BILKENT UNIVERSITY...»

«  Speech by MERVYN KING GOVERNOR OF THE BANK OF ENGLAND “Banking: From Bagehot to Basel, and Back Again” The Second Bagehot Lecture Buttonwood Gathering, New York City on Monday 25 October 2010 I am indebted to Stephen Burgess, Philip Evans, Andy Haldane, Andrew Hauser, Vicky Saporta, Jenny Scott, Paul Tucker and especially to Iain de Weymarn for their useful comments and suggestions on earlier drafts.     2 1. Introduction Walter Bagehot was a brilliant observer and writer on...»

«Development paths in the Caribbean Economic Commission for Latin America and the Caribbean (ECLAC) The views expressed in this document, which has been reproduced without formal editing, are those of the authors and do not necessarily reflect those of the Organization. [LC/CAR/L.401 Copyright © United Nations, December 2012. All rights reserved ECLAC – Project Documents collection Development paths in the Caribbean Contents Abstract I. Existing Development Trajectories A. Introduction B....»

«Deakin Research Online This is the published version: de Koker, Louis and Jentzsch, Nicola 2011, Financial inclusion and financial integrity : aligned incentives?, in Shadow 2011 : The shadow economy, tax evasion and money laundering : Proceedings of the 2011 Shadow conference, University of Münster, Münster, Germany, pp. 1-28.Available from Deakin Research Online: http://hdl.handle.net/10536/DRO/DU:30041719 Reproduced with the kind permission of the copyright owner. Copyright : 2011, The...»

«RESEARCH PAPER 5/2015 The business size distribution in Australia Jan A. Swanepoel and Anthony W. Harrison September 2015 Abstract This paper identifies trends and features in the business size structure (by employment) in Australia and investigates some of the drivers of these trends. We find that the dynamics of business counts at the jurisdictional, regional and sectoral level have been variable over the past few years given the interplay of various factors such as local economic conditions...»

«Was Monetary Policy Optimal During Past Deflation Scares? By Roberto M. Billi C ountries around the world have fallen into one of the deepest recessions since the Great Depression—a recession exacerbated by a severe financial crisis. Among the challenges that face monetary policymakers in such uncertain times is the danger economies worldwide, including the United States, Japan, and the euro area, may enter a period of deflation, in which the prices of goods and services fall relentlessly....»

«Marketing of Tourism Experiences This book provides a review of the current theory and practice of experiential tourism and how it is marketed. Many societies today are characterised by widespread individual wealth of an order previously confined to the elite with the consequence that ownership of ‘ordinary’ physical goods is no longer a distinguishing factor. Instead people are now seeking the ‘extraordinary’ with examples being bodies enhanced through surgery, personal fitness...»

«Key Professions at CATS College Canterbury Key at CATS College Canterbury At CATS College Canterbury we aim to support you in every stage of your future life as you embark on your journey to university and beyond. As you know, some universities require you to take additional tests such as LNAT (Law), TSA, SAT as well as our Medics needing to take UKCAT or BMAT. It is important that you have someone to help and advise you with these as you go through the year. There are special ‘Oxbridge...»

«BACHELOR THESIS Spring 2010 Kristianstad University International Business and Economics Program Human Resource Management Motivation among employees in multinational corporations Writers Kristina Trifunovska Robin Trifunovski Supervisor Agneta Moulettes Examiner Timurs Umans _ Abstract _ Title: Human Resource Management; Motivation among employees in multinational corporations. Authors: Kristina Trifunovska, Robin Trifunovski Tutor: Agneta Moulettes Problem: Motivation is the number one...»

«Economic Impact of Head Start JANET CURRIE, PhD University of California, USA (Published online December 16, 2005) (Revised April 23, 2009) Topic Head Start policy Introduction Head Start is an American preschool program for poor threeand four-year-old children. In 2007 the program spent about $7 billion U.S. on approximately 900,000 youngsters. The program began in the 1960s as part of President Johnson’s “War on Poverty.” The goal of the program was to bring poor children closer to the...»

«A Review of International Approaches to Waste Prevention, and Minimisation Report to Defra, Business Resource Efficiency and Waste (BREW) Programme January 2007 The Construction Resources & Waste Platform (CRWP) is funded by DEFRA's Business Resource Efficiency and Waste (BREW) Programme and managed by AEA Energy & Environment and BRE Restricted – Commercial International Approaches to Waste Prevention and Minimisation AEA/ED00000/Issue 1 A Review of International Approaches to Waste...»

«Social Interaction, Social Context, and Language Essays in Honor o f Susan Ervin-Tripp Social Interaction, Social Context, and Language Essays in Honor of Susan Ervin-Tripp Edited by Dan Isaac Slobin University o f California at Berkeley Julie Gerhardt California Institute o f Integral Studies Amy Kyratzis University o f California at Santa Barbara Jiansheng Guo Victoria University o f Wellington, New Zealand Psychology Press Taylor & Francis Group NEW YORK AND LONDON First Published 1996 by...»

<<  HOME   |    CONTACTS
2016 www.dissertation.xlibx.info - Dissertations, online materials

Materials of this site are available for review, all rights belong to their respective owners.
If you do not agree with the fact that your material is placed on this site, please, email us, we will within 1-2 business days delete him.