Increasing the uptake and usage of mobile money as a savings device

SECTOR

Inclusive Finance

PROJECT TYPE

Lab-in-the-field experiment

DOI

Location

Tanzania

BEHAVIORAL THEME

Relative rank | Perception of self | Anchoring

OVERVIEW

Can simple messaging induce saving habits?

The mobile money landscape in Tanzania has been rapidly evolving, closely following Kenya in terms of total penetration. In 2017 more than 50% of Tanzania’s adult population was registered for formal digital financial services, mostly mobile money. Tanzania is also the first country in Sub–Saharan Africa to allow mobile money providers to earn interest on their escrow accounts, with Tigo–Pesa being the first to offer its subscribers interest payouts of 7-9% per annum (better than a one–year term deposit). Despite these incentives however, average mobile savings balances remain low, especially among low–income users.

THEMATIC AREAS

We designed the experiment as a lab–in–the–field study within 3 different informal areas of Dar es Salaam. In total, there were five groups – the pure control group, a control message, and then the three treatments. The three treatment groups received SMS’s that were inspired by the behavioral themes found during the exploratory data collection. The pure control group received no SMS messages.