By Supriya Singh
Irene, 30, sits in a pandanus hut fringed by mountains in the Morobe province inPapua New Guinea and tells how her family of six lives on $2.79 a day. They grow 150 kg of betel nut that brings them about 1000 kina (roughly $500) a year. This is money from her husband’s land, so it is money she does not control. She sells taro, fruit and greens every fortnight at the market, a half-an-hour walk from her village. From the 40 kina she gets, she buys oil and salt. Sixteen kina go for her husband’s mobile phone top-up every fortnight paying for 20 minutes talk time. ‘I buy rice if there is money. If not, we eat taro every day, every month.’
Irene saves her money in the walls of the pandanus hut or a hole in the ground. Irene’s dream is to educate her four boys. The annual school fees for her three who are in school are nearly 100 kina. Holding her youngest close to her, she says she went to the clinic at the market and paid 50 toya (half a kina) to have him seen. She gives two to three kina a week to her husband who has gambling debts. There are weddings and funerals where each family gifts two or three kina plus food. Her father gives her money occasionally. Her two brothers send her money when they can.
There is a mobile tower in her village, though no electricity and no mobile money. Irene wants a secure place for her savings, but she does not have a 100 kina to spare for a return ride to a bank. Like many at the base of the pyramid, Irene needs to be able to manage small, irregular and unpredictable amounts of money for the family’s daily needs. She saves in order to spend later and borrows if she can. She wants to separate money that is immediately available for every day needs and some that can be sequestered away from herself and her husband so that it slowly builds up to pay school fees. And as with all of us, money is a medium of relationship.
A sustainable financial service would have women, relationships and money management at the centre. One of the reasons for M-PESA’s success in Kenya is that it enabled people to send money instantly to their network of family and friends to show they care. If mobile services are to be part of the solution, it is imperative to ensure women do not become even more disadvantaged than at present. Women at the base of the pyramid are often the second or third in the household to get a mobile phone, with the husband having the first. As information about money is not always shared between husband and wife, women need independent, affordable and private access to a mobile phone.
Ignacio Mas wrote a perceptive piece where he said we need to think beyond mobile, beyond banking and focus on money management and customer experience. This would require aggregators who would link banks, payments, technology and other financial and social network providers to offer customers a satisfying personal customer experience.
There are two emerging models that have money management and wealth creation at the centre of the customer experience. Alternative financial service providers in the United States like SmartyPig, Goalmine, Mint, Simple and Movenbank target people who feel they are being inadequately served by banks. Their world is mobile. These new players bring together banks, payments and technology providers, mobile and social media networks, to help people manage their money.
The second model revolves around having persons on the ground to enable people at the base of the pyramid to achieve their wealth creation goals. Kshetriya Gramin Financial Services (KGFS) focuses on the poor who have no or few formal financial services. KGFS began operations in June 2008 in three different rural areas inIndia. Its emphasis is on providing local, immediately accessible branches in rural areas that are not served by private banks. Staff visit village households when they establish the branch. Information about the household’s financial situation and its aspirations are the starting point for advice about products, services and strategies offered by multiple providers. Insurance and pension services initially are the most widely used financial services. Wealth managers at the local level are evaluated according to how well they have helped households achieve their goals.
There are many similarities in the way the poor, the middle-income groups and the rich want to be financially served. Mobile services, banks and other formal financial institutions will remain part of the picture. Aggregators would focus on money management, whether delivered virtually or through human intermediaries. With customers and money management at the centre of financial services, Irene is more likely to see her children go to school. And now and again the family will have rice.
 A pseudonym
 Mas, Ignacio. Making Mobile Money Daily Relevant, REVISED 2 April 2012. Available from papers.ssrn.com/sol3/papers.cfm?abstract_id=2018807 accessed 13 September 2012.