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The ‘Transformational’ Potential of
Mobile Money in Zambia
Frugal Innovation, Inclusive Innovation and Mobile
Money Agents in Kitwe
Iva Peša
Centre for Frugal Innovation in Africa
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
Debates & Focus
• Mobile money
• Frugal innovation (‘catching up’ & ‘leapfrogging’)
• Financial inclusion (‘banking the unbanked’)
• ICT4D debates: ‘transformational’ potential
• Mobile money merely exacerbates existing socio-
economic inequalities within political economy
• Does the frugal innovation of mobile money have the
potential to become an inclusive innovation for a group
of mobile money agents and tellers in Kitwe, Zambia?
• Entrepreneurship, employment creation, local economic
development
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
Mobile Money in Kitwe, Zambia
• Three providers: Airtel, MTN (2012) and Zoona
(2009)
• 2015: 14.0% use mobile money (Finscope)
• Focus on agents and tellers
• Intermediaries between network providers and
customers
• Financial ‘formalisation’: cash and virtual
economy
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
Mobile Money Agents as Entrepreneurs
•“In Africa, there is a tremendous pool of entrepreneurs,
business owners, and young people who dream of making
money and serving their communities but who lack the right
opportunity, resources and support to reach their full
potential. Zoona is an African Start-up that offers these
Emerging Entrepreneurs an opportunity to provide money
transfer and other payment services to low-income
consumers, while earning commissions and creating
employment. We provide a mobile money platform, working
capital financing, business management tools and
entrepreneurial support focused on helping businesses grow
and increasing financial inclusion in Africa.”
•www.ilovezoona.com
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
Methodology
• Survey among 52 mobile money
agents and tellers in Kitwe
• Followed by in-depth interviews
• Topics discussed: background,
relationship to network provider,
customer relations, business
strategy, future plans
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
Sandra Jere, Zoona Entrepreneur
• Runs 13 outlets and employs over 25 tellers
• ‘First mover’ advantage: market creation
• Loan from Zoona
• Human capital, business skills and
perseverance
• Entrepreneurship and employment generation
• No previous job experience, Grade 12
education, reliance on new customer base…
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
Franchising and Labour Relations
• Franchising structure
• Relationship between mobile money providers
and agents/tellers
• Profit incentives, managing float and cash
• Agents as independent business owners &
entrepreneurs vs. tellers as informal workers
• Market saturation and limits to growth
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
Agents as Entrepreneurs, Tellers as
Informal Labour?
• Mobile money agents as opportunity entrepreneurs
(discovery & creation opportunities)
• Precarious labour conditions even among agents,
due to franchising
• Mobile money tellers and informalisation
• How does this affect financial inclusion and
economic growth?
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
Conclusion
• Mobile money generates entrepreneurship, but does not
address existing socio-economic inequalities
• For economic transformation, “changes to non-ICT
specific structures and power relations that limit Africa’s
ability to participate in the global information economy”
need to be addressed (Murphy, Carmody & Surborg,
2014, 264)
• Mobile money as a successful frugal innovation?
• Scaling: agents and tellers – intermediation, trust and the
social construction of a market, financial inclusion
• Mobile money as an inclusive innovation?
Centre for
Frugal
Innovation
in Africa
www.cfia.nl
@FrugalAfrica
#FrugalInnovation
