Posted by: Victoria Rau, Senior Analyst, Inclusive Finance
Leaving the city of Jijiga to conduct focus groups in a village, I expected to face some rough terrain. I imagined unpaved roads, lots of dust, and a serious test of our SUV’s suspension.
In the day I had already spent in Jijiga, the Somali region had proved a sharp departure from fast-paced, modern Addis Ababa. There were camels to greet visitors on the road from the airport to the city, and from about one in the afternoon until five or six o’clock, shops were shuttered and business interactions paused for the Somali equivalent of the siesta: afternoons were spent resting and chewing khat, a plant with stimulant, euphoric and appetite suppressant effects that is traditionally chewed as a social custom in the Horn of Africa.
The content of our focus group discussions was financial literacy and mobile phone usage among beneficiaries of one of Ethiopia’s longest running government transfer programs, the Productive Safety Net Programme (PSNP). Enclude’s team was there to conduct a needs assessment aimed at producing a curriculum initiative that would enhance PSNP beneficiaries’ financial capability, especially related to electronic payments.
Given the Somali region’s drought-induced economic difficulties, strong religious influence on the culture (including the practice of polygamy), and agro-pastoralist tendencies, we expected the focus groups to reveal lower levels of financial literacy, a greater degree of patriarchy, and lower awareness of electronic or mobile channels for financial services.
In other regions of Ethiopia, PSNP had already introduced electronic payments via agents in lieu of cash transfers, and had rolled out financial education efforts on topics such as savings and debt management as part of the PSNP’s livelihoods component. Each of these initiatives was slated to begin in Somali region after our visit, and this was another reason I expected focus group participants to lag behind those in other regions in terms of financial literacy and e-payment awareness.
Our trip to a village outside Guresume and the discussions we had there challenged my assumptions, and Somali region became an outlier for our research in ways we did not expect.
First, the road was amazing–smooth and recently paved, it snaked through the dry and occasionally hilly landscape. It was less bumpy and harrowing than some journeys I have made in Washington, D.C.
Second, the women were unquestionably in charge of family finances. In separate discussion groups for men and women, participants were in agreement on this point. One man said women were “more active participants on these [financial] issues” while one woman summed up the group’s consensus that “male household heads share their ideas with the female, but most of the budgeting decisions are made by the woman. Women know more about household expenses than men.” No members of either the men’s or women’s groups were in polygamous marriages, perhaps because in practical terms polygamy requires a certain level of wealth in the form of land, assets and income. The focus of our research was on low-income families selected by their communities as beneficiaries of the PSNP.
The women were also far more entrepreneurial than the men, mentioning business ideas such as packaging, cold storage, and sales of camel milk. They sat with us for over three hours, without any compensation and only modest refreshments. At the end, when asked if they had any questions for the researchers, one woman asked that we share with the international community that they would really appreciate access to capital to invest in their businesses.
The biggest surprise was that many of the discussants were both financially literate and highly aware of mobile payments. The majority were aware of and / or using the financial products and services available to them to manage their finances. Available services largely revolved around informal group savings, loans, and insurance, but some participants had accessed microfinance or other financial services. Several women had taken a loan at one time, but later determined that it was not viable for their current stage of businesses. Others had savings accounts opened with the Commercial Bank of Ethiopia (CBE) through an NGO-led savings initiative, had contributed to these accounts for a period of time, and did not intend to access the money until they had a plan to use it for its intended productive purpose.
Mobile payments were more familiar to Somali men and women than to focus group participants in any other regions, despite the fact that the region will be the last to introduce electronic PSNP payments. In part, this awareness is due to the strong brand recognition of Hello Cash in the Somali region. One man had his own Hello Cash account and one woman had used a neighbor’s account to transact with her son who was away at university.
Returning to Jijiga on the same smooth road, I reflected on the assumptions I had made about the Somali region and its people, and realized they were largely unfounded. While our research confirmed the need (and demand) for financial education, Somali beneficiaries would be starting with greater familiarity with electronic payments than most of their counterparts in other regions, and the materials would need to be contextualized accordingly. The experience was a reminder of the great privilege that those of us who work in development have in interacting with vulnerable communities, especially the inspiration we can derive from the resilience observed there. In turn, it was a reminder of the responsibility we all have to challenge our assumptions.