Types of Research
- (-) Remove West Africa Region and Selected Countries filter West Africa Region and Selected Countries
- (-) Remove Information & Mobile Technology filter Information & Mobile Technology
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- (-) Remove Finance & Investment filter Finance & Investment
- (-) Remove South Asia Region and Selected Countries filter South Asia Region and Selected Countries
Many low- and middle-income countries remain challenged by a financial infrastructure gap, evidenced by very low numbers of bank branches and automated teller machines (ATMs) (e.g., 2.9 branches per 100,000 people in Ethiopia versus 13.5 in India and 32.9 in the United States (U.S.) and 0.5 ATMs per 100,000 people in Ethiopia versus 19.7 in India and 173 in the U.S.) (The World Bank 2015a; 2015b). Furthermore, only an estimated 62 percent of adults globally have a banking account through a formal financial institution, leaving over 2 billion adults unbanked (Demirgüç–Kunt et al., 2015). While conventional banks have struggled to extend their networks into low-income and rural communities, digital financial services (DFS) have the potential to extend financial opportunities to these groups (Radcliffe & Voorhies, 2012). In order to utilize DFS however, users must convert physical cash to electronic money which requires access to cash-in, cash-out (CICO) networks—physical access points including bank branches but also including “branchless banking" access points such as ATMs, point-of-sale (POS) terminals, agents, and cash merchants. As mobile money and branchless banking expand, countries are developing new regulations to govern their operations (Lyman, Ivatury, & Staschen, 2006; Lyman, Pickens, & Porteous, 2008; Ivatury & Mas, 2008), including regulations targeting aspects of the different CICO interfaces.
EPAR's work on CICO networks consists of five components. First, we summarize types of recent mobile money and branchless banking regulations related to CICO networks and review available evidence on the impacts these regulations may have on markets and consumers. In addition to this technical report we developed a short addendum (EPAR 355a) which includes a description of findings on patterns around CICO regulations over time. Another addendum (EPAR 355b) summarizes trends in exclusivity regulations including overall trends, country-specific approaches to exclusivity, and a table showing how available data on DFS adoption from FII and GSMA might relate to changes in exclusivity policies over time. A third addendum (EPAR 355c) explores trends in CICO network expansion with a focus on policies seeking to improve access among more remote or under-served populations. Lastly, we developed a database of CICO regulations, including a regulatory decision options table which outlines the key decisions that countries can make to regulate CICOs and a timeline of when specific regulations related to CICOs were introduced in eight focus countries, Bangladesh, India, Indonesia, Kenya, Nigeria, Pakistan, Tanzania, and Uganda.
Donor countries and multilateral organizations may pursue multiple goals with foreign aid, including supporting low-income country development for strategic/security purposes (national security, regional political stability) and for short-and long-term economic interests (market development and access, local and regional market stability). While the literature on the effectiveness of aid in supporting progress on different indicators of country development is inconclusive, donors are interested in evidence that aid funding is not permanent but rather contributes to a process by which recipient countries develop to a point that they are economically self-sufficient. In this report, we review the literature on measures of country self-sufficiency and descriptive evidence from illustrative case studies to explore conditions associated with transitions toward self-sufficiency in certain contexts.
In this report we analyze three waves nationally-representative household survey data from Kenya, Uganda, Tanzania, Nigeria, Pakistan, Bangladesh, India, and Indonesia to explore sociodemographic and economic factors associated with mobile money adoption, awareness, and use across countries and over time. Our findings indicate that to realize the potential of digital financial services to reach currently unbanked populations and increase financial inclusion, particular attention needs to be paid to barriers faced by women in accessing mobile money. While policies and interventions to promote education, employment, phone ownership, and having a bank account may broadly help to increase mobile money adoption and use, potentially bringing in currently unbanked populations, specific policies targeting women may be needed to close current gender gaps.
Mobile technology is associated with a variety of positive development and social outcomes, and as a result reaching the “final frontier” of uncovered populations is an important policy issue. We use proprietary 2012 data on mobile coverage from Collins Bartholomew to estimate the proportion of the population living in areas without mobile coverage globally and in selected regions and countries, and use spatial analysis to identify where these populations are concentrated. We then compare our coverage estimates to data from previous years and estimates from the most recent literature to provide a picture of recent trends in coverage expansion, considering separately the trends for coverage of urban and rural populations. We find that mobile coverage expansion rates are slowing, as easier to reach urban populations in developing countries are now almost entirely covered and the remaining uncovered populations are more dispersed in rural areas and therefore more difficult and costly to reach. This analysis of mobile coverage trends was the focus of an initial report on mobile coverage estimates. In a follow-up paper prepared for presentation at the 2016 APPAM International Conference, we investigate the assumption that levels of mobile network coverage are related to the degree of market liberalization at the country level.
In this report, we analyze the evidence that improved and expanded access to financial services can be a pathway out of poverty in Bangladesh and Tanzania. A brief background review of finance and poverty reduction evidence at the country, household, and individual level emphasizes the importance of a functioning financial system and the need to remove individual and household barriers to capital accumulation. We follow with an in-depth literature review on studies that link poverty reduction in Bangladesh or Tanzania with one or more of five financial intervention categories: remittances; government subsidies; conditional and unconditional cash transfers; credit; and combination programs. The resulting empirical evidence from these sources reveal a high share (61%) of positive reported associations between a financial intervention and outcome measure related to our five chosen financial interventions. The remaining studies found insignificant or mixed associations, but very few (3 out of 56) indicate that access to a financial mechanism was associated with worsened poverty. The heterogeneity of study types and interventions makes it difficult to draw conclusions about the efficacy of one intervention over another, and more research is needed on whether such approaches constitute a durable, long-term exit from poverty.
Common aid allocation formulas incorporate measures of income per capita but not measures of poverty, likely based on the assumption that rising average incomes are associated with reduced poverty. If declining poverty is the outcome of interest, however, the case of Nigeria illustrates that such aid allocation formulas could lead to poorly targeted or inefficient aid disbursements. Using data from the World Bank and the Nigerian National Bureau of Statistics, we find that while the relationship between economic growth and poverty in Nigeria varies depending on the time period studied, overall from 1992-2009 Nigeria’s poverty rate has only declined by 6% despite a 70% increase in per capita gross domestic product (GDP). A review of the literature indicates that income inequality, the prominence of the oil sector, unemployment, corruption, and poor education and health in Nigeria may help to explain the pattern of high ongoing poverty rates in the country even in the presence of economic growth. Our analysis is limited by substantial gaps in the availability of quality data on measures of poverty and economic growth in Nigeria, an issue also raised in the literature we reviewed, but our findings support arguments that economic growth should not be assumed to lead to poverty reduction and that the relationship between these outcomes likely depends on contextual factors.
This report provides a summary of findings from six Financial Inclusion Insights (FII) data analysis reports conducted by various agencies for the Bill & Melinda Gates Foundation (BMGF). These reports investigate barriers to financial inclusion and use of digital financial services (DFS) in Bangladesh, India, Kenya, Nigeria, Pakistan, Tanzania, and Uganda. We compile comparable gender-specific statistics, summarize the authors’ findings to determine commonalities and differences across countries, and highlight gender-specific conclusions and recommendations provided in the studies.
Donors and governments are increasingly seeking to implement development projects through self-help groups (SHGs) in the belief that such institutional arrangements will enhance development outcomes, encourage sustainability, and foster capacity in local civil society – all at lower cost to coffers. But little is known about the effectiveness of such institutional arrangements or the potential harm that might be caused by using SHGs as ‘vehicles’ for the delivery of development aid. This report synthesizes available evidence on the effectiveness of Self-Help Groups (SHGs) in promoting health, finance, agriculture, and empowerment objectives in South Asia and Sub-Saharan Africa. Our findings are intended to inform strategic decisions about how to best use scarce resources to leverage existing SHG interventions in various geographies and to better understand how local institutions such as SHGs can serve as platforms to enhance investments.
In recent years, product supply chains for agricultural goods have become increasingly globalized. As a result, greater numbers of smallholder farmers in South Asia (SA) and Sub-Saharan Africa (SSA) participate in global supply chains, many of them through contract farming (CF). CF is an arrangement between a farmer and a processing or marketing firm for the production and supply of agricultural products, often at predetermined prices. This literature review finds empirical evidence that demonstrates that the economic and social benefits of CF for smallholder farmers are mixed. A number of studies suggest that CF may improve farmer productivity, reduce production risk and transaction costs, and increase farmer incomes. However, critics caution that CF may undermine farmers’ relative bargaining power and increase health, environmental, and financial risk through exposure to monopsonistic markets, weak contract environments, and unfamiliar agricultural technologies. There is consensus across the literature that CF has the best outcomes for farmers when farmers have more bargaining power to negotiate the terms of the contract. In reviewing the literature on CF, we find a number of challenges to comparing studies and evaluating outcomes across contracts. This literature review summarizes empirical findings and analyses regarding contract models and best practices to increase farmers’ bargaining power and decrease contract default.