COVID-19 has fundamentally changed how we interact with each other in our social lives and more so on how we transact business. For mobile money agents, this not only means conducting business in a changing environment but also having to deal with the dangers of contracting and spreading the virus as they serve the populations through cash-in/cash-out (CICO) transactions. As vital digital finance lifelines in their communities, agents need telecom operators and governments to do more to prepare them on best practices during the pandemic, such as promoting preventive public health measures at their shops. We at Pesakit, in support of mobile money agents’ contributions to the Kenya economy, have launched three initiatives to protect their health and their livelihoods.
Mobile money agents provide an essential service
Mobile money agents have been instrumental in enabling populations to convert physical money to digital value particularly in emerging markets. For more than a decade, agents have been at the center of mobile money services onboarding, training, and supporting end consumers on a daily basis. Agents are the face of mobile money services, and as such, they are the first point of contact between providers and the end consumers. Resultantly, more people have been included in the digital financial economy improving livelihoods and catalyzing entrepreneurship for groups that have otherwise been excluded. The GSMA reports that with more than one billion mobile money accounts globally, more women are accessing and using financial services, low-income households are accessing essential utility services and payment remittances, and groups such as smallholder farmers are getting paid more safely, quickly, and conveniently.
For many governments, the effectiveness of agents is key to undertaking measures to support the populations through cash payments and for the populations to turn to digital finance. Governments across emerging markets have identified CICO agents as essential service providers increasing the daily cash limits to enable high-value transactions as a means of supporting the uptake of digital finance as witnessed in Kenya.
But mobile money agents are vulnerable to infection and unwittingly spreading the virus
The World Bank reports that 66% of adults in Sub-Saharan Africa do not have access to traditional financial services such as a bank account. Consequently, a large section of the population rely on the services of mobile money agents for CICO needs, more so, as people turn to digital finance. Even though the importance of agents has categorically been felt across the globe, with the current crisis, Mobile Network Operators (MNOs) and governments have done little to educate them on best practices on handling physical money, hygiene, and social distancing at the shops. Agents are at a higher risk of contracting COVID-19 due to their very nature of physically handling money which essentially brings them into contact with banknotes that have been potentially handled by thousands of people, some of whom may have the virus without their knowledge. The World Health Organization has flagged cash transfers from one person to another as one of the ways that COVID-19 could easily spread rapidly.
“The importance of agents in emerging markets has also meant that with the spread of COVID-19, their services thrust them to become frontline workers as governments seek mechanisms to stem the spread of the virus.”
While agents shops do present a solution to supporting government initiatives such as the call by the Kenyan Government to turn to digital finance as a mechanism to curb the spread of COVID-19, they may also pose a potential danger to further worsening the crisis due to the flow of physical money from one person to another.
Our Responses to COVID-19
PesaKit recognizes the fundamental importance of mobile money agents to the economy and the livelihoods of the population in Kenya. The continuity of mobile money agency businesses, not only means continued generation of income for the more than 200,000 agents in Kenya, but also a means through which the Kenyan economy will recover once the crisis has passed.
In the past month, Kenyan agent businesses have adversely felt the impacts of COVID-19 with a majority of our agents reporting in a recent survey a 70% decrease in revenue, decreased footfall, and increased challenges in managing liquidity at their shops. Agents feel the biggest risk they face is getting infected with COVID-19 even as they incur costs to put in safety measures best as they can.
As the Kenyan society continually adapts to the rising COVID-19 numbers, agents have been forced to close their shops earlier than usual to beat the 7 pm to 5 am curfew and they have had to adapt to reduced banking hours affecting their income drastically, especially in the case of urban agents. If the situation continues as is, the agents we surveyed fear having to go out of business as the lockdown will become untenable for their shops.
As a means to support agent businesses and ensure that they are well prepared to protect themselves and their customers from the spread of the virus, we have come up with the following responses:
COVID-19 Safety & Misinformation Campaign
According to the Kenyan government through the Ministry of Health, Kenya has 582 confirmed COVID-19 cases and 26 fatalities as of May 06, 2020. While the government has taken initiatives such as the 7 pm-5 am curfew and the lockdown of high-risk regions such as the Nairobi Metropolitan area to stem the spread of the virus, mobile money agents remain at risk of infection as they continually serve millions of Kenyans seeking to cash in or cash out at their shops.
PesaKit Safety Campaign educates mobile money agents on best practices at their shop to prevent the spread of COVID-19 while combating misinformation through the following themes:
- Best hygiene practices
- Best practices in handling physical cash
- Best practices in hand washing
- Social distancing
- Safety and prevention
By providing information and preparation, the PesaKit Safety Campaign seeks to support mobile money agents’ business continuity, prevent the spread of COVID-19 at an agent location, and ensure that Kenyans continually access digital finance at safe and secure locations.
PesaKit Float Exchange
Mobile money agents frequently visit bank outlets to purchase float and rebalance liquidity at their shops. With the spread of COVID-19, reduced banking hours, and the need to maintain social distance to curb the spread of the virus, agents are unable to maintain efficiency in managing their till and effectively losing valuable customers in a time when CICO transactions have drastically declined.
PesaKit Float Exchange solves this problem by enabling M-Pesa agents to access e-float through digitized PesaKit agents in select towns across Kenya. An M-Pesa agent registers with PesaKit, provides their agency details, and PesaKit loads the agent’s till whenever requested. Through our digitized agents, we are able to securely and remotely enable the rebalancing of liquidity at an agent’s shop without the need to go to the bank.
PesaKit Float Exchange is a free, secure, time-saving, and affordable liquidity rebalancing mechanism helping agents meet their customers’ CICO needs while curbing the spread of COVID-19.
COVID-19 Insurance Cover
While mobile money agents may have not yet have come into contact with COVID-19 at the moment, each day the number of cases in Kenya rises thereby increasing their risk of infection particularly those serving areas deemed as epicenters, such as Nairobi. A high number of agents do not hold a health insurance policy to act as a safety net in the case they are quarantined, hospitalized, or incapacitated from opening their shops, on which their livelihoods depend.
PesaKit COVID-19 insurance cover is a 12-month hospitalization insurance cover that provides agents with an income safety net whilst testing positive, quarantining, or being admitted to a hospital due to COVID-19. Our agents can access the health insurance policies for as low as Ksh 1,000 (US$10) per annum, protecting themselves and their loved ones.
AtPesaKit, we are continually innovating solutions to support and empower mobile money agents during the crisis to cope and ensure their businesses stay open, such that our agents are well-prepared for any eventualities, and that our communities are able to access essential CICO services at safe locations.
During the pandemic and beyond, mobile money agents will continue to be hubs for essential and value-added services and Pesakit will be there to bolster their survival and growth.