teleuse by the bangladeshi migrant worker this work was carried out with the aid of a grant from the...
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Teleuse by the Bangladeshi migrant worker
This work was carried out with the aid of a grant from the International Development Research Centre, Canada and the Department for International Development, UK, with contributions from Telenor Research & Development Centre Sdn. Bhd., Malaysia.Photo credits: CKS Consulting Pvt. Ltd.
Teleuse@BOP background
• Objective: To understand how Bottom of the Pyramid interacts with ICTs (mostly phones) to better inform policy• Large surveys of ‘BOP’ conducted in 2005, 2006, 2008• Almost 20,000 face to face interviews in 6 countries since 2005
• Bangladesh (2008)• Pakistan• India• Sri Lanka• Philippines• Thailand
• Funded by the International Development Research Center (IDRC) of Canada, the Department for International Development (DFID), UK with contributions from Telenor Research and Innovation, Malaysia
2
Method
• Multi-stage stratified sampling, random selection of households and individuals
• Field research conducted by Nielsen; 12 languages; 6 countries• Migrant worker teleusers at “bottom of the pyramid”
– SEC groups C* + D + E– Overseas and domestic migrants that send money home
3
Samples
Bangladesh Pakistan[1] India Sri Lanka[2] Philippines[3] Thailand[4] Total BOP teleusers 2,050 1,814 3,152 924 800 800 9,540Margin of error @ 95% CL (%) + 3% + 2% + 2% + 3% + 4% + 4%
Diary Sample 1,025 900 1,600 450 400 400 4,775
Migrant workers 350 300 400 200 200 100 1,550
4
[1] Pakistan: Excludes tribal regions[2] Sri Lanka: Excludes North and East[3] Philippines: Survey was undertaken only among SEC E[4] Thailand: Excludes Bangkok as the SEC DE population in Bangkok is very small
Sampling logic
• Multi-staged stratified sampling by probability proportionate to size – Regions (states/provinces/districts) randomly selected in
2006; kept the same for comparison in 2008 (except BD)– Stratification of cities within state, province etc– Geographical ordering of cities, villages– PPS selection of cities, villages
• Within PSU– Random starting points– 10 HH per starting point; right hand rule– KISH grid to select respondent in HH
Agenda
WHO ARE THE BOP?BOP TELECOM EXPANSION
ACCESSOWNERSHIP
MARKET POTENTIALWHAT THOSE AT BOP DO WITH THEIR MOBILES?POTENTIAL FOR MOBILE 2.0?BENEFITS?THE UNCONNECTED…
6
back
Agenda
WHO ARE THE BOP?BOP TELECOM EXPANSION
ACCESSOWNERSHIP
MARKET POTENTIAL WHAT THOSE AT BOP DO WITH THEIR MOBILES?
POTENTIAL FOR MOBILE 2.0?BENEFITS? THE UNCONNECTED…
7
back
The study represents approx. 62 million in Bangladesh
• Teleusers at “bottom of the pyramid”– SEC groups D + E– Aged 15-60
(Rural India: R2, R3, R4)
8
43 52 60 62
0
72
57 48 40 38
100
28
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Socioeconomic group classification (% of sample)
SEC D SEC E
Among BOP teleusers
Link between SEC D+E and "$2 per day" definition
Bangladesh Pakistan India Sri Lanka Philippines Thailand
SEC D+E (% of population) 73 59 69 44 38
[SEC E]33
Less than $2 per day (% of population) 78 85 86 45 40 28
Actual population proportions
9
Households earning ~USD71-143 per month (on average)
10Among BOP teleusers
54% of Bangladeshi BOP households don't own a phone 54% BOP = 57% of BOP teleusers
• 80% of these non-owners can reach a phone in under 5 minutes– Urban: 89% can reach a phone in under 5 mins– Rural: 78% can reach a phone in under 5 mins
Among all BOP teleusers
54 5748
2429
7
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Non-ownership (% of BOP)
Main reasons for not owning are affordability and the lack of a need
Among BOP non-owner teleusers
Bangladeshi BOP can afford USD23 to get connected, but think that it will actually cost them USD38
Among BOP non-owner teleusers
3829 31
4935
60
23 22 22 2213
63
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Initial cost of getting connected (USD)
Expected Affordable
Once connected they can afford to spend USD1.80 per month on communication costs, while they think it will actually cost them USD2.50
14
2.5 2.8 2.75.2 6.1 6.6
1.8 2.3 1.94.2 5.3
11.0
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Monthly expenditure (USD)
Expected Affordable
Among BOP non-owner teleusers
31% of the current unconnected BOP in Bangladesh plan to get connected; 98% through a mobile
Among BOP non-owner teleusers planning to get connected
98% 93% 92%
58%
89% 100%
0% 0% 1%
6%
6%0%0% 2% 1%
33%0% 0%2% 1% 0% 1% 0% 0%0% 4% 5% 3% 5% 0%
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Type of phone planning to buy (% of potential BOP owners)
Mobile Fixed (wireline) Fixed (wireless) Fixed (undecided) Not decided
Background to migrant study component being released for first time in Dhaka today
Method
– SEC groups C* + D + E, aged between 15 – 60– Migrant worker & migrant worker families (qualitative) interviewed. – “domestic” and “overseas” migrants
– Domestic: Living and working away from home (within the same country)– Overseas: Returned (temporarily or permanently) from working in a foreign country
– Had used a phone in the last three months– Had sent money to family in the last thee months
Quantitative
1,500+ face-to-face interviews Oct-Nov 2008
Qualitative
Depth interviews through home visits with migrant workers and/or families in location of origin Feb-Mar 2009
•A small sample of SEC C users was taken in Pakistan
Quantitative sample
18
[1] Pakistan: Excludes tribal regions; includes SEC C[2] Sri Lanka: Excludes North and East[3] Thailand: Excludes Bangkok as the SEC DE population in Bangkok is very small
Bangladesh Pakistan[1] India Sri Lanka[2] Philippines Thailand[3]
Domestic migrant 170 111 116 104 150
Overseas migrant 180 199 307 106 50 100
Total 350 310 423 210 200 100
Qualitative sample
Home visits with media mapping
IndiaUrban 0Peri-urban 4Rural 2
Bangladesh Urban 2Rural 2
Pakistan Urban 2Rural 2
Sri Lanka Urban 2Rural 2
Philippines Urban 1Rural 1
Thailand Urban 1Rural 1
Total 22
With migrant workers & migrant
worker families
Outline
> Migrant worker sample characteristics> Communicating home> Sending money home> Mobile remittances?
21
Migrant worker characteristics
Mostly SEC D and E, some C in PK
• Migrant workers (domestic or overseas) from “bottom of the pyramid” who remit money to family
– SEC groups D + E mainly, some C in PK– Aged 15-60
Socio-economic group classification (% of BOP)
27%
41%
57% 60% 65%
48%
49%
32%43% 40% 36%
52%
51%
Bangladesh Pakistan India Sri Lanka Philippines Thailand
SEC C SEC D SEC E
Mostly males in BD, PK & IN; males + females in LK, PH and THMore educated migrants from PK* and PH* includes SEC C migrants
Migrants earning USD 417 (overseas) & USD 124 (domestic) per month on average
Bangladesh Pakistan * India Sri Lanka Philippines Thailand
Overseas Mode 432 261 556 138 435
Mean (sd)
485(516)
346 (195)
413(168)
294(214)
475(325)
Domestic Mode 86 105 67 138 174 232
Mean (sd)
84(44)
136 (142)
100(56)
125(56)
164(110)
259(143)
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Bank account 32% 29% 48% 84% 53% 80%
Credit card 11% 5% 4% 15% 11% 16%
Ownership of bank account or credit card (% of BOP migrants surveyed)
* Many refused to answer
Monthly personal income (USD)
Majority of overseas migrants work in Middle East; Southeast Asia also popular among SeA migrants
Bangladesh destination countries
Communicating home
28% Bangladeshi overseas migrants make Internet calls; 8% Internet chat (everyone, except a few Filipinos, uses the phone!)
Overseas migrants
Domestic migrants
020406080
100
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Modes of communication with family and friends at home (% of BOP domestic migrants surveyed)
Telephone calls SMS Letters/Telegrams Emails Internet calls/Internal text chatting Faxes Other
3616
3 8 80
0
20
40
60
80
100
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Modes of communication with family and friends at home (% of BOP overseas migrants surveyed)
Telephone calls SMS Letters/Telegrams Emails Internet calls/chatting Faxes Other
0%
20%
40%
60%
80%
100%
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Most frequently used phone (% of domestic migrants surveyed)Others
Public access phones
A friend or relatives phone
My work place phone / Office phone / employers phoneA neighbours phone
Common household phone
My own phone
Own phones (mostly mobile) used most as primary phone, followed by public phones; primary use to keep in touch with loved ones at home, and for work (depending on job)
Domestic migrants
0%
20%
40%
60%
80%
100%
Bangladesh Pakistan India Sri Lanka Philippines
Most frequently used phone (% of overseas migrants surveyed)Public access phones
A friend or relatives phone
My work place phone / Office phone / employers phoneA neighbours phone
Common household phone
My own phone
Overseas migrants
Simi | Farmer / housewife / mother of domestic migrantSimi | Farmer / housewife / mother of domestic migrantJae Hom, Thailand (rural)Jae Hom, Thailand (rural)
• Migration almost always results in mobile adoption, either the migrant purchases the handset and gives it to her family, or she passes down her handset and buys a new one for herself.• Simi’s son is a domestic migrant. She has a mobile primarily to keep in touch her son who works outside of the city. After he migrated, the need to be in constant touch with her son arose. • Before owning a mobile, communicating with her son involved lots of time, effort and constant mediation by others.
- To call she had to travel (a considerable distance) by bike with her husband to a public phone, where she would often have to spend time waiting in line. - To receive a call from him, she would have to go by bike with her cousin to the cousin’s house where she could receive the call.
• After two years her son bought her a mobile phone.
Bangladeshi and Pakistani overseas migrants call home most frequently: 87% in BD call home at least once a week; 34% dailyBased on respondent recall
Overseas migrants
• The primary need for communication was to keep in touch with loved ones at home. Depending on the type of job (e.g., client-driven, delivery-based, etc.) some need to communicate with local contacts.
• Often, the communication needs of overseas migrants are limited to communication with family and friends at home, rather than contacts within their destination country. However once they return home for holidays, the need to stay in touch with supervisors/bosses/colleagues in increases, in order to ensure they have a job (or the same position) to return to.
0
20
40
60
80
100
Bangladesh Pakistan India Sri Lanka Philippines
Frequency of calls (% of overseas migrant respondents who make calls)Can't sayLess frequent than once in two monthsOnce in two monthsOnce a monthTwo to three times a monthOnce a weekTwo to six times a weekOnce a dayMore than once a day
At least once a week
Daily
0%
20%
40%
60%
80%
100%
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Frequency of calls (% of domestic migrant respondents that make calls)
Can't sayLess frequent than once in two monthsOnce in two monthsOnce a monthTwo to three times a monthOnce a weekTwo to six times a weekOnce a dayMore than once a day
Domestic migrants call more frequently than overseas migrants; again highest in BDBased on respondent recall
Domestic migrants
Per-minute peak tariffs (pre-paid)
Bangladesh Pakistan India* Sri Lanka Philippines Thailand
Mobile (on-net) 0.025 0.029 0.023 0.047 0.134 0.086
Mobile (off-net) 0.034 0.032 0.023 0.071 0.155 0.086
Fixed (Local/National) 0.034 0.032 0.023 0.071 0.155 0.086
Source: LIRNEasia (2008, October). Mobile Price Benchmarks* Refers to local charges only; national per-minute tariff is 0.034
At least once a week
Daily
0%
20%
40%
60%
80%
100%
Bangladesh Pakistan Sri Lanka Philippines
Frequency of use of SMS (% of overseas migrants who use SMS)Can't sayLess frequent than once in two monthsOnce in two monthsthree to four times a monthOnce in two weeksOnce a weekTwo to six times a weekOnce a dayMore than once a day
SMS popular among PK and PH overseas migrants, and PK, LK and PH domestic migrants
Overseas migrants
Domestic migrants
SMS charges (prepaid; USD)
Bangladesh Pakistan India* Sri Lanka Philippines Thailand
SMS (on-net) 0.017 0.016 0.023 0.012 0.021 0.058
SMS (off-net) 0.017 0.025 0.023 0.024 0.021 0.058Source: LIRNEasia (2008, October), Mobile Price Benchmarks.* Refers to local charges only; national per-minute tariff is 0.034
0%20%40%60%80%
100%
Pakistan India Sri Lanka Philippines
Frequency of use of SMS - domestic migrants (% of domestic migrants who use SMS)Can't sayLess frequent than once in two monthsOnce in two monthsthree to four times a monthOnce in two weeksOnce a weekTwo to six times a weekOnce a dayMore than once a day
Bangladeshi overseas migrants spend most: USD48 per month on average; thrice that in IN/PH; most overseas B’deshis spend USD 40-50/month, most others spend USD10-20
0.00 30.00 60.00 90.00 120.00 150.00
15-Average monthly expenditure for communication (In USD)
0
5
10
15
20
25
30
Fre
qu
ency
Mean = 48.0906Std. Dev. = 35.17881N = 170
Histogram
BangladeshMean: USD 48
Most spend USD 40-50
PakistanMean: USD 36
Most spend USD 10-20
0.00 20.00 40.00 60.00 80.00 100.00 120.00 140.00
15-Average monthly expenditure for communication (In USD)
0
5
10
15
20
25
Fre
qu
ency
Mean = 36.1558Std. Dev. = 32.68238N = 109
Histogram
IndiaMean: USD 15
Most spend USD10-20
0.00 20.00 40.00 60.00 80.00 100.00 120.00
15-Average monthly expenditure for communication (In USD)
0
10
20
30
40
50
Fre
qu
ency
Mean = 15.0642Std. Dev. = 18.52647N = 116
Histogram
Overseas migrants
Mean monthly expenditure on communicating home (cont'd)
Sri Lanka Mean: USD 38
Most spend USD10-20
PhilippinesMean: USD 16
Most spend USD10-20
Overseas migrants
0.00 20.00 40.00 60.00 80.00 100.00 120.00 140.00
15-Average monthly expenditure for communication (In USD)
0
5
10
15
20
25
30
Fre
qu
ency
Mean = 37.5765Std. Dev. = 32.65786N = 96
Histogram
0.00 20.00 40.00 60.00 80.00 100.00 120.00 140.00
15-Average monthly expenditure for communication (In USD)
0
5
10
15
20
25
30
Fre
qu
ency
Mean = 37.5765Std. Dev. = 32.65786N = 96
Histogram
0.00 10.00 20.00 30.00 40.00 50.00 60.00 70.00
36-Average monthly expenditure (USD)
0
50
100
150
200
Fre
qu
ency
Mean = 3.3414Std. Dev. = 4.70375N = 304
Histogram
0.00 20.00 40.00 60.00 80.00 100.00 120.00
36-Average monthly expenditure (USD)
0
20
40
60
80
100
Fre
qu
ency
Mean = 8.5283Std. Dev. = 13.33638N = 199
Histogram
0.00 20.00 40.00 60.00 80.00 100.00
36-Average monthly expenditure (USD)
0
20
40
60
80
100
120
Fre
qu
en
cy
Mean = 7.0807Std. Dev. = 13.39107N = 180
Histogram
Domestic migrants
BangladeshMean: USD 7.08
Most spend less than USD 5
PakistanMean: USD 8.52
Most spend less than USD 5
IndiaMean: USD 3.34
Most spend less than USD 6.67
Domestic migrants
0.00 20.00 40.00 60.00 80.00 100.00
36-Average monthly expenditure (USD)
0
10
20
30
40
50
60
Fre
qu
ency
Mean = 9.6774Std. Dev. = 10.62936N = 100
Histogram
0.00 5.00 10.00 15.00 20.00
36-Average monthly expenditure (USD)
0
2
4
6
8
10
12
Fre
qu
ency
Mean = 4.4022Std. Dev. = 3.83997N = 50
Histogram
0.00 10.00 20.00 30.00 40.00 50.00 60.00
36-Average monthly expenditure (USD)
0
10
20
30
40
Fre
qu
ency
Mean = 8.6034Std. Dev. = 10.95279N = 103
Histogram
Sri Lanka Mean: USD 8.60
Most spend less than USD 6.67
PhilippinesMean: USD 4.40
Most spend USD1.25-2.50
Domestic migrants
ThailandMean: USD 9.68
Most spend USD5-10
Cost of calling home from 4* of top 5 destination countries: Off-peak* International calling rates from Kuwait not available
• Per minute cost of calling home using largest mobile operator (except UAE: second largest)
Calling from
To
USD1.20
USD1.17
USD0.58
Cost of calling home from 4* of top 5 destination countries: Peak* International calling rates from Kuwait not available
• Per minute cost of calling home using largest mobile operator (except UAE: second largest)
Calling from
To
USD1.34USD1.24
USD0.65
Bangladeshi overseas migrants make longer calls Based on respondent recall
Longer calls, more often higher costs
Sending money home
Lourdes | GrandmotherLourdes | Grandmother57 | Metro Manila, Philippines 57 | Metro Manila, Philippines
USD 9b overseas remittances to Bangladesh in 2008 (AFP, http://www.google.com/hostednews/afp/article/ALeqM5jyBqlJab_jioB-w9Mnn1lhf55lIQ )
• Nearly 10% of GDP; significant contributor to foreign reserves
• May 2009 saw record of USD 890m in remittances • Official estimates: 6.3m overseas migrants (unofficial:
9m)
Bangladeshi overseas migrants remit USD203 per month on average (highest in S Asia); domestic remit USD27
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Overseas Mean(sd)
203(143)
198(182)
182(89)
137(129)
249(208)
Mode 144 261 222 92 217
Domestic Mean 27(20)
93(111)
51(38)
60(96)
91(88)
54(51)
Mode 29 52 44 46 43 29
Most BD overseas migrants send money home every 1-2 months; less frequently than in PK
Overseas migrants
0%
20%
40%
60%
80%
100%
Bangladesh Pakistan India Sri Lanka Philippines
Frequency of remittances (% of overseas migrants surveyed)Refused
Once a year
Once every six months
Once every four months
Once every three months
Once every two months
Once a month
More than once a month
0
10
20
30
40
50
60
70
80
90
100
Bangladesh Pakistan India Sri Lanka Philippines
Methods of remittance (% of overseas migrants surveyed)I deposit money straight into their bank accounts/bank transfersI take the money with me when I go home
I send it in cash with another friend or relative
Purchase goods and send to my family through othersHundi/ Hawala
Postal money orders/postal mail
Money transfer through mobile phone payment systemsMoney Transferring services (Eg: Western Union, Money Gram..etcRefused
Other (incl. internet payment systems)
Overseas migrants mostly send money through banks or in cash (low cost option)
Overseas migrants
Sending money through banks is seen to be cheap and reliable; often migrants open bank accounts for their family in order to receive money. Drawbacks are that a visit
to the bank is necessary (though some migrants befriend bank workers –often countrymen– who facilitate transfers
without the migrant needing to visit), and banking facilities should be easily
accessible to the migrant’s family too
Though many in the Philippines use money transfer services (e.g. Western Union),
it is seen to be more expensive, therefore used as a
second option, to bank transfers
Hundi can be costly, but is capable of doorstep delivery in rural areas; additionally, loans
can also be taken from the vendor (at high interest rates);
it is seen to be reliable in IN and PK, but not BD and LK
Domestic migrants mostly remit once a month (when they go home)
Domestic migrants
0%
20%
40%
60%
80%
100%
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Frequency of remittances (% of domestic migrants surveyed)Refused
Once a year
Once every six months
Once every four months
Once every three months
Once every two months
Once a month
More than once a month
0
10
20
30
40
50
60
70
80
90
100
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Methods of remittance (% of domestic migrants surveyed)
I deposit money straight into their bank accounts/bank transfers
I take the money with me when I go home
I send it in cash with another friend or relative
Purchase goods and send to my family through others
Hundi/ Hawala
Postal money orders/postal mail
Money transfer through mobile phone payment systems
Money Transferring services (Eg: Western Union, Money Gram..etc
Refused
Domestic migrants send/take money in cash; "mobile payments" used by 6 % in BD and 2 % in PH
Domestic migrants
Sending money with friends and relatives is free and
reliable and thus popular; it is often reciprocal; includes sending money through
(known) bus or ferry drivers
Post office money transfers, are extremely popular among domestic migrants in India
due to the low cost, doorstep delivery, perceived extensive coverage of the postal network, but also the reliability, since it is
operated by the government
Remittances are also delivered through bus drivers in India and Philippines, and ferry drivers in
Bangladesh; often the driver is an acquaintance, so no charge is levied and he knows who exactly to deliver
the money to
Most who remit via banks are satisfied, though complaining of cost in LK and PH
0%
20%
40%
60%
80%
100%
Bangladesh India Sri Lanka Philippines
How satisfied migrants are with bank deposits/transfers: Cost (% of migrants who remit via banks most often)
Extremely Satisfied
Somewhat Satisfied
Neither Satisfied Nor Dissatisfied
Somewhat Dissatisfied
Extremely Dissatisfied
0%
20%
40%
60%
80%
100%
Bangladesh India Sri Lanka Philippines
How satisfied migrants are with bank deposits/transfers: Reliability/trustworthiness (% of migrants who remit via banks most
often)
Extremely Satisfied
Somewhat Satisfied
Neither Satisfied Nor Dissatisfied
Somewhat Dissatisfied
Extremely Dissatisfied
Transfer charges?Bank wire transfers were
seen as more expensive and thus resorted to only
emergency situations since transfer takes only minutes
• Bank and wire transfers were among those most popularly used, and was seen as one of the cheaper and convenient options
– E.g., In Dubai, the worker need not have a bank account. The Etisalat Bank provides workers with a bank ID using which they can send money to any account of their choice and the nominal service fee is paid by them in cash. Service charge amounts to 2.5% of the total amount sent or AED 100 (USD 27.2) for transactions less than AED 5,000 (USD 1,360).
0%
20%
40%
60%
80%
100%
Bangladesh India Sri Lanka Philippines
How satisfied migrants are with bank deposits/transfers: Convenience (% of migrants who remit via banks most often)
Extremely Satisfied
Somewhat Satisfied
Neither Satisfied Nor Dissatisfied
Somewhat Dissatisfied
Extremely Dissatisfied
Mobile remittances?
Higher awareness among BD migrants compared to other S Asian migrants; overseas migrants more aware
34
17 20 22
53
30
6 7
22
43
60
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Awareness of mobile remittance services (% of migrants surveyed who do not use services)
Overseas Domestic
0%
20%
40%
60%
80%
100%
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Use of mobile remittance services (% of all migrants surveyed)
3% BD migrants* are using "mobile remittances" * 6% of domestic migrants
Operating guidelines for
mobile payments proposed (Jan
2009)
Regulatory framework for mobile banking drafted (June
2008)
Services offered: Smart Padala, G-
Cash
Proposed services (Venyon and
Kasikornbank))
Proposed services (Bharti Airtel, Western
Union)
Services not offered; transfers
possibly via e load
Zayed | Shopkeeper Zayed | Shopkeeper 21 years | Sonargaon, Bangladesh21 years | Sonargaon, Bangladesh
• Once facilitated money “transfer” Once facilitated money “transfer” through mobile for the village through mobile for the village “maulavi” who was away in Dhaka; “maulavi” who was away in Dhaka; the maulavi sent BDT1,000 in load to the maulavi sent BDT1,000 in load to Zayed’s mobile; once the load was Zayed’s mobile; once the load was received, Zayed then paid the same in received, Zayed then paid the same in cash to the maulavi’s family in the cash to the maulavi’s family in the villagevillage
• Other respondents seemed to be Other respondents seemed to be doing the same. It is only available doing the same. It is only available internally, but useful to send money internally, but useful to send money to rural areas.to rural areas.
• Migrants try to maintain good Migrants try to maintain good relations with shopkeepers in their relations with shopkeepers in their village who provide this servicevillage who provide this service
• Transactions of up to BDT5,000 Transactions of up to BDT5,000 (USD70) can be made, however this is (USD70) can be made, however this is dependent upon the shopkeeper dependent upon the shopkeeper having cash available to give the having cash available to give the intended recipient in one gointended recipient in one go
• Commissions can be as high as 20%; Commissions can be as high as 20%; the shopkeeper also makes the shopkeeper also makes commission on reselling the loadcommission on reselling the load
Lack of know-how is key barrier to greater use in BD
Other barriers to the use of mobiles for financial transactions
• Low levels of literacy lack of confidence– Lack of English literacy (mobile content predominantly in English)
• Except for Philippines, respondents cited difficulty navigating mobile interface, especially older respondents
• Perception that a certain set of “soft skills” are needed in order to use such services, none of which they have
• For the immediate future, banks, hundi, social networks, etc offer sufficient reliability. Open to the idea of new services, though concerns of credibility of service providers prevail; unwilling to invest until results are shown
PK and BD most willing to use services, if affordably priced; not so much enthusiasm in PH!
81% 87%
58% 63%56% 53%
Bangladesh Pakistan India Sri Lanka Philippines Thailand
Willing to use mobile remittances if available at an affordable cost (% of non-user migrants surveyed who are aware)
The future?
• Existing methods provide sufficient reliability, are convenient and are affordable• BOP migrant workers unwilling to pay large service
charges/commissions to transfer remittances
• BOP migrant workers open to learning about new services, but place premium on trustworthiness• Would prefer if banks are involved
• Even when mobiles remittance services not used, mobiles used to coordinate remittances• Sending transaction codes over SMS; calling to confirm receipt,
etc.
Saleem Afeez | Dispensary owner Saleem Afeez | Dispensary owner Saeeda Begum I Housewife Saeeda Begum I Housewife 53 years | Dhaka, Bangladesh 53 years | Dhaka, Bangladesh 46 years | Dhaka, Bangladesh 46 years | Dhaka, Bangladesh
• Saleem and Saeeda’s eldest Saleem and Saeeda’s eldest son is an overseas migrant son is an overseas migrant working in Singaporeworking in Singapore
• He sends his parents BDT He sends his parents BDT 10,000-15,000 per month. He 10,000-15,000 per month. He transfers the money from his transfers the money from his bank account to his father’s.bank account to his father’s.
• He calls on the day that the He calls on the day that the transfer is made. After four transfer is made. After four days Saleem goes to the bank days Saleem goes to the bank and withdraws the money and withdraws the money through a chequethrough a cheque
• They find this process the They find this process the most reliable; money has never most reliable; money has never been delayed or lost. been delayed or lost.
• Saleem is aware of the hundi Saleem is aware of the hundi system but does not trust itsystem but does not trust it
•He is open to trying financial He is open to trying financial services but would need services but would need substantial proof of its substantial proof of its reliability for him to take it upreliability for him to take it up
Policy implications: ILDTS policy is counterproductive and unfair
• Harms overseas workers and is shortsighted with respect to real source of money– Those who call Bangladesh include many who are poor;
they work hard to support their families and provide foreign exchange earnings for Bangladesh
• They spend more money than those from comparator countries on communication (USD 48 v USD 15 for Indians)
• They have been pushed to use less-convenient Internet mode
• The government is not taking 52% of the money of IGW operators; it is taking 52% of the hard-earned money of its overseas workers
ILDTS policy harmful in other ways: Why are IN, PK & LK earning from BPOs, and BD not?
1. India (position in 2007 GSLI: 1) 2.China (2) 3.Malaysia (3) 4.Thailand (4) 5.Indonesia(6) 6.Egypt (13) 7.Philippines (8) 8.Chile (7) 9.Jordan (14) 10.Vietnam (19) 11.Mexico (10) 12.Brazil (5) 13.Bulgaria (9) 14.United States (Tier II)* (21) 15.Ghana (27) 16.Sri Lanka (29) •Tunisia (26) 2.Estonia (15) 3.Romania (33) 4.Pakistan (30) 5.Lithuania (28) 6.Latvia (17) 7.Costa Rica (34) 8.Jamaica (32) 9.Mauritius (25)
26.Senegal (39) 27.Argentina (23) 28.Canada (35) 29.United Arab Emirates (20) 30.Morocco (36) 31.United Kingdom (Tier II)* (42) 32.Czech Republic (16) 33.Russia (37) 34.Germany (Tier II)* (40) 35.Singapore (11) 36.Uruguay (22) 37.Hungary (24) 38.Poland (18) 39.South Africa (31) 40.Slovakia (12) 41.France (Tier II)* (48) •Ukraine (47) 27.Panama (41) 28.Turkey (49) 29.Spain (43) 30.New Zealand (44) 31.Australia (45) 32.Ireland (50) 33.Israel (38) 34.Portugal (46)
AT Kearny 2009rankings
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