Mobile money services, which allow users to store and exchange monetary values via mobile phone, may help lift people in developing economies out of poverty, a new study led by an Indian origin researcher suggests. The study shows that mobile-money services have had notable long-term effects on poverty reduction in Kenya - especially among female-headed households and have inspired a surprising occupation shift among women.
The study led by Tavneet Suri, associate professor at Massachusetts Institute of Technology (MIT) in the US, estimates that, since 2008, access to mobile-money services increased daily per capita consumption levels of 194,000 or 2 per cent of Kenyan households, lifting them out of extreme poverty (living on less than $1.25 per day). Female-headed households saw far greater increases in consumption than male-headed households, researchers said.
“Previously, we’ve shown mobile money helps you with financial resilience. But no one has understood, if you improve resilience, what happens over the longer term. This is the first study that looks at long-term poverty reduction and at gender,” said Suri, who collaborated with William Jack, an economist at Georgetown University.