> Posted by Kim Wilson, the Fletcher School, Tufts University

Today, I used my smartphone to pound tiny nails into a wall. The procedure worked well enough to hang a small picture, but it cracked my phone case.

I wasn’t trying to go digital by using a mobile device. I simply could not find the proper tool – a hammer. The episode made me think that going hammer-lite would be silly for a pounding task. I really needed a hammer. If I were trying to tighten a screw, a task I just had to do on a door handle, I suppose I could go screwdriver-lite. I could try to wedge a tag of the broken phone casing into the screw’s octagonal chamber, then give it a twist. It might work. But an Allen wrench might work better.

So, in financial inclusion why are we trying to go “cash-lite?” Cash can be a sturdy pair of pliers that turn income into neat, countable paper stacks – one pushed into the desk drawer for buying groceries and another plopped into a tin for evenings out. Cash can also be a wrench, torqued just so, to help us make sure that we have enough coins to pay the parking attendant or enough paper to pay ourselves when we feel the need to devise a personal austerity plan.

As customers, we really don’t want to go wrench-lite, hammer-lite, or even cash-lite. We just want the best tools possible.

Though the financial inclusion industry trumpets customer-centricity – putting the customer at the center of our decisions about how to best serve them – how it goes about this endeavor is baffling. One might presume that a good method would be to ask the customer what task she wants to perform and then find or make the best tools to help her, as this video suggests. But, for the most part, that’s not our way. We constantly urge – “get an account, go cash-lite” – ignoring a lack in evidence that otherwise might prove: going digital increases income equality, growth, and customer happiness. In fact, the opposite has been documented.

Despite its customer-at-the-center masquerade, financial inclusion is really about keeping its suppliers at the center. NGOs and governments, reliant on formal aid or foundations recently sprung from their natal corporations, depend on movement and change as their stock in trade. So do corporations. Change is what keeps the media humming with tweets, blogs, and press releases. Change is what makes profits grow. In the case of money, pushing people to change over to digital cash serves the top line of the telcos, banks, and card companies. Cash does not.

No organization, it seems, wants to fund a demand-side effort to keep cash around for hammer-like tasks. The assumption is that customers, on their own, can maintain the status quo of cash-as-a-tool. They don’t need us change agents to do so. But this thinking is deeply flawed. While cash is a good tool now and then, even cash is a challenge to some. Even cash must be managed, especially when it comes to credit or savings or even spending.

We are removing cash from a system in which cash has not been mastered. “No worries, we will leapfrog all that,” we tell ourselves. Kids will be born into digital money and never miss cash just the way we were born into calculators or apps and don’t miss slide rules. But the problem is that not-yet literate kids have trouble mastering the math behind the apps. In fact, the apps lull them into thinking that they don’t need to know fundamental arithmetic. When they get nonsensical answers from our digital surfaces, they lack the skills to judge their folly. The physicality of the slide rule at least forced some of us to take pen to paper now and then, to check our steps.

Imagine coming from a culture that is illiterate (adult illiteracy in Africa is 38 percent and in some countries like Senegal as high as 50 percent), and then tumbling headlong into the well of mobile money. Your account surely would be empty  – always – either because its contents vanished from fees or because you withdrew your money so you could re-enter the hammer and wrench world. If you stayed in the digital world, you would miss the chance to check your steps. And if you have only a little money, checking your steps is key to survival.

A wholesale move to e-cash, even to cash-lite does not reflect the demand of customers. The push is not customer-centric, but supply-centric. The literature defends the push strictly from a view of the presumed benefits to customers, if only they would go cash-lite, not from any real perspective on the tools that customers crave.

We have an agenda, which is this: please be our customer, have your needs, express them so long as they are about digital payments or failing that, using a bank account ­­– a lot – and preferably, digitally. Else, we don’t give a damn. We don’t care about your archaic methods of pacing yourself through the use of paper currency. We don’t care about your coins pressed through the slot of a savings box. We desperately want and need you to modernize, to become just like us. Otherwise we have no justification for all the work we do and all the money we spend.

Tomorrow when I hang another picture, I will look for a hammer in search of a nail. I know a whole industry of hammers in search of nails – it’s called financial inclusion. I’ll begin my search there.

Image credit: Accion

kimwilsonKim Wilson is a Lecturer in International Business at the Fletcher School, Tufts University. She is also a member of Fletcher’s Council on Emerging Market Enterprises and Director of the Fletcher Leadership Program for Financial Inclusion.

Have you read?

Responding to Needs and Wants in a Market-Driven Financial Institution

Putting Users in Control of Their (Digital) Identity

The Better Than Cash Alliance Is Out to Create a ‘Cash Lite’ World