The gender impact of digital payments

  • October 17, 2017

  • Kapchorwa, Uganda

by Sabine Mensah & Lara Gilman

For further information contact:

Naomi de Groot
KM Consultant, Uganda


Female coffee farmers save and invest more after receiving their pay on their phone.

When you drink your exquisite cup of Arabica coffee, close your eyes and think beyond the wonderful aroma. Behind it lie the stories of farmers such as Nafina, Napanga and Tweke; three farmers from Kapchorwa, in the Mont Elgon region of Uganda. In efforts encouraging farmers to accept digital payment for their produce, Nafina, Napanga and Tweke are part of a UNCDF programme focused on digitizing agricultural value chains across the country. Within this programme, they were introduced to receiving their payment on their mobile phone in 2016. A year later, all three women consider themselves active users of mobile money and are quick to praise its impact on their lives.

Mobile money has proven to help, even transform, the economic lives of women. A 2016 Kenyan study looked at the longitudinal impact of M-Pesa at the household level. Not only did it find that mobile money had a positive economic impact on nearly 200,000 households, but that female-headed households experienced the greatest uplift. Financial resilience, savings and occupational choice improved substantially as a direct result of access to M-Pesa. Over the course of the study, 185,000 women moved from subsistence farming to business occupations - a trend the researchers attribute to mobile money access.

The insights yielded from Kenya provide tangible evidence of the meaningful impact digital financial services can have on the lives of users—particularly for more vulnerable populations, such as women and rural communities. However, the barriers to effectively serve these communities have yet to be overcome.

Although the number of financially included women increased between 2011 and 2014, women are still 23% less likely than men to have access to an account1 in sub-Saharan Africa. Digitizing payments can be a powerful hook to increase access to financial services for women, particularly in agricultural sectors where it is estimated that women make up half of agricultural labour in sub-Saharan Africa. However, the challenge that UNCDF is working to overcome is how to increase the relevance and utility of digital financial services for people who need it most. This is what underpins the work with Nafina, Napanga and Tweke in Uganda.

Nafina farms coffee on two acres of land that is owned by her husband. As for Napanga, she owns eight acres of land and farms coffee and matooke (bananas). Tweke has three acres of land and farms coffee, Irish potato and matooke. Working in partnership with Kyagalani Coffee Limited, a coffee exporter, Yo! Uganda, an aggregator and MTN, a mobile network operator, UNCDF’s project aims to digitize coffee payments and lay the foundation to develop a mobile money environment that meets the needs of the farmers and their community. A key part of this is understanding how to transform a digital payment made to Nafina, Napanga and Tweke into a suite of services that meets their financial needs.

When Nafina, Napanga and Tweke sold their coffee at the weighing station last year, the ladies had the opportunity to participate in a financial literacy and mobile money training programme led by IDEO, another partner on this project who specializes in human centered design; a methodology to keep the customer at centre during product development. Through a user-centered approach, these women developed personalized financial goals and aspirations alongside a savings budget and a realistic timeline.

This approach gave a practical application of mobile money that was flexible enough to be tailored to their individual needs. Nafina’s goal was to buy a cow and a solar panel for her home. She now uses mobile money to store her earnings from selling her coffee beans. For Napanga, mobile money gave her a more secure alternative to storing cash. Her savings are now safely stored on her mobile money account. This enabled her to buy two goats and open a shop in half the time she anticipated. Tweke uses mobile money just to keep her money away from the eyes of her family. And it worked; because she has less cash in her pocket and therefore limited her unplanned expenses. As a result, her savings allowed her to increase investment into her agricultural inputs at the end of the harvest.

These success stories not only underline the impact that mobile money can have on women, they also highlight the importance of ensuring digital financial services need to be flexible and adaptable to the unique financial goals and ambitions of each individual.

1 According to the Global Findex 2014, an account can be at a bank, financial institution or a mobile account.