My first professional experience in the international development field was at the International Rescue Committee in Charlottesville, part-time while at the University of Virginia. Working in a resettlement organization provided me with a unique chance to interact closely with refugees from countries including Iraq, Uzbekistan, Burma, and the DRC, and to hear their incredible stories of fleeing terrible situations and eventually finding themselves in Charlottesville, a safe, comfortable place where they could send their kids to schools for free. Of the many things I learned from this experience, there was one thing that struck me the most. Despite the fact that many of these people had been professionals in their own countries before being forced to flee, they started out their new life in debt. Unable to take any assets with them, they had no money or belongings – only a plane ticket to America which the US government asks them to repay, eventually.
Now, I know that resettlement is an incredibly complex issue and that there is a seemingly endless stream of challenges in dealing with refugee populations. At the same time, this idea of loss of assets struck me as one challenge that we should be able counter, fairly simply, in our modern world where electronic money is becoming the norm. I was so interested in this concept that I considered writing my Masters thesis on it; unfortunately, there simply wasn’t enough literature or activity in this area to do so, at the time – and this was just a few years ago. Now, with mobile and electronic banking spreading throughout the developing world, and with organizations testing the use of new financial tools for a variety of development and humanitarian, purposes, I am excited about the possibility to revisit this topic.
There is a fair amount of work and interest being focused on how to use e-transfers – whether through mobile phones, ATM cards, or vouchers – to send people money quickly when a disaster hits (see this recent article which provides an overview on some of the projects being carried out by Concern Worldwide.) This is a great start. However, from a resilience perspective, we have a lot more work to do to make sure that people can build assets over time and access these assets from anywhere. In order to do this, there are are three steps that I see as critical, which cover the financial education, regulatory environment, and quality of service.
First, people in vulnerable areas need to have a permanent account that they know how to use – voucher programs are a good initial step but do not provide this; therefore, we should be pushing to transition cash transfer programs from vouchers to accounts as quickly as possible (note: this applies to paper or mobile voucher programs.)
Second, regulations need to be in place that ensure that people can access their accounts even if they lose their official form of identification – this was a major issue after the earthquake in Haiti, and is true of many of the types of situations that create refugees in the first place. Regulations and services also need to be in place in order to allow these accounts to be accessed in any country – in the current situation, I can access my Citibank account worldwide, but a Kenyan can only access their M-Pesa account in Kenya, which would leave them without access to those funds in a refugee situation where they were not able to return to Kenya, for any reason.
Thrid, people have to trust the organizations that provide these accounts, so they feel comfortable converting non-liquid assets, such as livestock, to electronic stored value. While all individuals and households should make their own decision about how to diversify between liquid and non-liquid assets, it is important that they understand that only assets held in electronic form will be accessible to them in the event of a crisis where infrastructure is destroyed or where they cannot return home.
These are a few of the factors that I think are critical – I would love your thoughts on what else would be required to make mobile money relevant to refugees.