> Posted by Sonja E. Kelly and Ruben Marquez, CFI and Bancomer
“What’s in a name? That which we call a rose by any other name would smell as sweet.” – Shakespeare
While Juliet’s musings on the essence of her Romeo might be poetic, she is quite wrong. Words determine a great deal about how we think about things—and one word change could change hundreds of thousands of people’s use of financial products.
Percent of People Who Report Saving in the Past Year
In Mexico, if you were to ask those at the base of the pyramid whether they save, they would likely tell you no. CFI’s Country Profiles show the Global Findex Data in the figure at right.
When asked whether they had saved any money in the past year, roughly 14 percent of people in the bottom 40 percent of the economy in Mexico answered yes. This same group of people in all upper middle income economies (of which Mexico was a part at the time of the survey) were about twice as likely to say yes to this question.
Does this mean that the poor in Mexico just don’t prioritize savings? Probably not.
In Mexico, there is a difference between the word for “saving” (ahorrar) and the word for “keeping” (guardar). When you ask people at the base of the pyramid whether they “keep” money for the future, they are much more likely to answer yes.
The Findex survey (the source of the above data) may have inadvertently run into this problem in Mexico. The difference between two words could explain the low incidence of saving reported at the base of the pyramid compared to countries with a similar income level.
When we take this language difference into account, there are implications for institutional knowledge, financial education, and product marketing.
On this front, Bancomer in Mexico has found that there is a reorientation to be done within the bank itself—while Bancomer is listening to clients, for listening to be effective it must be listening for the right language. Within the bank, integrating the vernacular of low-income clients has led to new views on this income segment. Past market research has included the question of whether potential clients are saving—with dismal results. With the recognition that this population is saving, but just calling it something else, there is a different perception of the kinds of products that customers might be interested in.
By listening in the right ways, Bancomer has realized that not only are people at the base of the pyramid saving by “keeping” money for the future, they are also saving by investing in commodities. For example, in Mexico it is quite common for low-income families to buy construction material, even when they have no immediate home-improvement plans. This is an inflation-proof savings strategy, as materials can be sold in the future at current market prices.
When it comes to working with clients, financial education must involve affirming that “keeping” money is the same as “saving” and “buying raw materials” is a form of both saving and investment. If low-income customers were to recognize this, it would significantly change the way they approach products offered at any institution. Imagine a prospective customer seeing a “money-keeping account” and thinking “Oh, that’s what I need. It will help me keep my money safe.”
Finally, from the bank’s perspective, how products are marketed is critical. Bancomer already has an arsenal of marketing around certain products. The promotion above, which offers a free pressure cooker if you open a savings account, might not be seen as relevant to someone at the base of the pyramid because it uses “ahorrar” instead of “guardar.” The ad may be sending a message from the bank to low-income consumers that the bank is not for them, keeping the bank from a potential market segment.
As we move forward with our understanding of people at the base of the pyramid, and the ways financial services can empower them to improve their lives, we must remember that the words we use—and the words we hear—are not arbitrary. They are integral to moving financial inclusion forward.
* “Poorer” is defined as those in the bottom 40 percent of the economy, and “richer” is defined as those in the top 60 percent. Figure includes both formal and informal savings mechanisms.
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May 30, 2014 at 8:46 am
John Gitau
Thank you Sonja for sharing this important finding. It is exactly what Dr Susan Johnson found out in Kenya in one of her researches.
Financial inclusion in an attempt to come up with universal terms such as savings, credit, investing can lose so many people along the way. We should borrow from the marketing field where market stratification is taken seriously as it determines success or failure of a product penetration and uptake. In Kenya, to reach the youth, advertising has slowly and heavily adopted “sheng” the popular slang among the youth who comprise 65% of the population.
This would mean that financial inclusion need to embrace possibilities of customer fragmentation on the basis of terminology nuances. That would actually make our field dynamic and more fun to be in. I get tired of using words such as savings and insurance because they are not only very tired but people have different meanings and pictures for them. An insurance expert might as well be talking to himself positioning an insurance protection product while the poor listeners know protection in the context of social capital relationships. You can understand how complex it can get when you realize that even us in the know, may not tell if business is a form of investment or business is what generates cash for investment. It gets tougher in interpretation when some investments acquire a business aura with people not sure what is being referred to.
I am now thinking it is strange that in my mother tongue we don’t have a word for investing but we have one for investment. People involved in investment talk about what they have done eg I have constructed a rental house, or I have bought a piece of land”. The word “used” for money, as in “I used the money” means so many things because it is an umbrella word that suggest spending, investing, giving and all other meanings. In modesty, it is a humble word that connotes ” don’t ask me further what I used the money for”.
I was engaged by an NGO to teach some 60 slum teenagers who had dropped out of school for one reason or another. I had prepared my discussion in English, assuming that even primary school drop outs should have basic English comprehension. On the ground, I found that I had to use our national language, Kiswahili. But even then, the girls still wouldn’t understand the formal Kiswahili I attempted using, their familiar version being “sheng” the slang. Ok, I speak “sheng” but soon I was to realize that their “sheng” version was that of the slum and quite deep. It was a total fiasco teaching savings and investing. In terms of success, I would give myself 3/10. Now, to teach the same girls effectively, what should I have done differently? Perhaps I would have organized a pre- training session and sought their terms and meaning for what I was to teach, that is saving and investing. Then I would have prepared my lesson around that and I would have had better results. Imagine I was a banker selling a savings product to the girls, what would have been my chance of success? My conclusion was that if anybody wanted to reach this demographic segment( they could be in thousands) one had no choice but to understand what they call what then go prepare products in line with the finding. Short of that, we, financial inclusion advocate might as well be talking to ourselves. I give credit to my country’s marketers as they have adopted slang for marketing. We can clearly see great uptake results. I am thinking how to teach financial literacy through slang because it is either that or I will be rendered irrelevant.
May 30, 2014 at 10:38 am
S.Kelly
It is fantastic, John, to hear about what this looks like in Kenya–Ruben and I had been thinking about low versus high income, but I had not even considered the age dimension. I would be interested in hearing more about what “sheng” means, and how effective its use has been in marketing and advertising since it has been recognized as a way people self identify their financial activity.
I’m sure this is something that you run up against quite frequently in a financial education context, since you have the responsibility of translating concepts used in financial institutions to whatever audience with which you are interacting. To hear that it is something that is difficult for you as well means that it must be a great challenge indeed!
May 30, 2014 at 10:29 am
Gabriela Zapata Alvarez
Congratulations on this post! Did you also read this blog?: http://www.cgap.org/blog/why-don’t-low-income-mexicans-use-formal-savings-products It also talks about the words people use to refer to a “savings” action that they themselves don’t call savings based precisely on the research we did with Bancomer. I think your point is very relevant because formal surveys (both the government’s and banks’) tend to ask the wrong question, or rather, the right question with incorrect wording. Azteca is great at capturing the language calling it’s basic account “Guardadito”. Looking at their mobile banking service, their icons are quite intuitive.
May 30, 2014 at 10:40 am
S.Kelly
Thanks so much, Gabriela, and thank you for the blog post from CGAP! It’s one that I actually hadn’t seen before, so it’s nice to hear that this finding is getting multiple dissemination venues. It certainly seems like a very relevant issue as we think about translating global financial principles to local contexts.
May 30, 2014 at 1:28 pm
John Gitau
Sheng is a mixture of English and Kiswahili essentially, but with concoction of words that are neither. Imagine a cup of tea and call that advertising or marketing. Sheng is the quantity of tea in that cup and blend as much. Don’t ask me to explain how much the tea blends with the water that combines to make the cup of tea.
For more about sheng, here is a an expert paper for further reading. The professor is a linguist and the only scholar I know on sheng: http://elanguage.net/journals/pragmatics/article/view/427
It is hard work teaching when you have 65% of target population adopting a new language coining their own financial words. I grew up talking sheng but that has long being overtaken and I might as well be learning afresh.
Let me give you a simple example. During our youth, the sheng word for house was Hao. You see that is just like a short name right? Currently, the sheng word for house is Kenja. It has absolutely no bearing to habitat, accommodation or shelter. I don’t know what it is derived from. Now, listen to this advert by the second largest bank advertising a home mortgage” “Babika na Kenja, kopa na salo” meaning feel good owning a house, borrow with salary. So:
Bambika comes from a sheng word bamba meaning be comfortable. The derivative is bambika. So it is complex but easy.
“Na” means with and it is proper Kiswahili
Kenja is sheng meaning house( no basis)
Kopa is a pure kiswahili word meaning borrow.
Salo is sheng derived from the English word salary so just like house is shortened to hao, salary is salo.
That advertisement is on ksh 1,000,000( $12,000) bill board on a highway. Now, can adaption of sheng get better? This is what you read on television adverts, you hear on radio, you see on bill boards. And most prominent advertisers are financial institutions, so we are talking financial inclusion. That ease of communication is what is driving the market in financial products uptake. It reaches the target customers perfectly well. And marketers are keeping tabs on the dynamism of sheng and new words and terms keep coming up.
Sonja, we are talking of a generation in Kenya that has its own language. The poor have their own language around money and financial practices. Religion is using their own terms to describe some financial services. Prayers for money for some prosperity christian denominations is being called “planting seeds” meaning investing( like in “invest in God and you will reap fruits of bountifulness”).
You can see how important stratification of the target financial inclusion population is if they have to be reached. If you doubt how effective religious prescribed forms of investing are, ask religious denominations how much they collect per week from their followers to understand the extent of their followers investment while waiting to reap from I don’t know where. So, when I am called to a religious congregation and I am discussing types of investment, do you see how confusing it can be to a middle aged person caught between virtual spiritual investing and real investing? So, I mention investing and give example of stock market. a listener’s mind goes to church. What is this? I am called to give a talk to the youth. I talk about investment in real estate. I talk of rental houses. Is that the same meaning as Kenja? I don’t know. What about distinguishing between commercial rental property from residential rental property and from Industrial rental property?. Do the youth in their minds have the kenja nuanced across the three areas of real estate investment? I am not sure because kenja to them means house or home.
We would have thought the challenge for financial institutions was designing suitable products from an financial affordability and relevance point of view. Nah! there is still designing relevant and affordable products with names and delivery language that resonates with the target population be they poor, youth, religious, men, women, rural, urban, slum dwellers, homeless, literate, and many other classification types.