Kenya in the Digital Finance Revolution with Sibel Kusimba

Money on the Left speaks with Sibel Kusimba, Associate Professor of Anthropology at University of South Florida, about her work on mobile money and digital finance in Kenya. In her recently published book with Stanford University Press titled Reimagining Money: Kenya in the Digital Finance Revolution, Kusimba both theorizes and critiques Kenya’s thriving M-Pesa mobile phone-based payment system as a constitutive component of Kenyan social life. In doing so, Kusimba explicitly eschews the postcolonial drive to develop more effective approaches to microloans or means for so-called “financial inclusion.” Instead, she offers a sophisticated culturally embedded analysis of mobile money, informed by her twenty-plus years of ethnographic study and archaeological fieldwork in Kenya. Understanding money as “wealth-in-people,” she traces mobile money’s role in shaping complexly gendered social networks and agencies, while simultaneously underscoring the political injustices of public austerity and privatized payment systems.

Theme music by Hillbilly Motobike.

Link to our Patreon:

Link to our GoFundMe: 


The following was transcribed by Richard Farrell and has been lightly edited for clarity.

William Saas: Sibel Kusimba, welcome to Money on the Left.

Sibel Kusimba: Thank you, I’m happy to be here.

William Saas: We’re happy to have you. We’d like to start, as we normally do, by asking you to share a little bit about your personal and professional background.

Sibel Kusimba: Sure, I’m an anthropologist. I have been working in East Africa, specifically in Kenya, for at least a couple of decades now. I am interested in culture and cultural change, and technology and technological change in East Africa over time. My work has spanned from the stone age to the present. So I have worked in archaeological projects and methods. I’m also a cultural anthropologist and have conducted ethnographic research, so both qualitative and quantitative kinds of studies. I have a long term interest in technology, in evolution, in why cultures change, and in why technological trajectories take the pathways that they do. So I came into the study of money from a very historical perspective on technological change. That’s kind of my background.

Scott Ferguson: Great, so we asked you to join us today to talk about your still pretty new book with Stanford University Press, which is titled Reimagining Money: Kenya in the Digital Finance Revolution. So this is pretty squarely in the present–it is not archaeological. At the most basic level, your book takes on, tries to make sense of, and historicizes the fairly rapid rise of mobile phone payment systems in Kenya. Maybe you can just kind of ease us into this discussion by telling us a little bit about how you got into the project? What are some of the major historical changes that are involved? What is this all about?

Sibel Kusimba: Sure. I guess, in the short term, the whole project begins around the year 2000 or so, with the beginning of the really rapid spread of mobile phone technology, or personal mobile communication devices in East Africa. The spread of the mobile phone in East Africa is considered to be one of the most rapid examples of technological diffusion that has ever happened in the human experience. When mobile technology was developed, and first deployed in Africa, one of the developments that really enabled large numbers of people to buy mobile phones and to begin to use mobile phones, was a pay as you go scratch card. So if you bought one of these cards, there would be a kind of silver adhesive over it. I don’t know what those are called, but I think we all know what those are. So if you scratch those off, you would get a code. And you could use those to buy a small amount of airtime credits. That’s a really common way of purchasing airtime still today in a lot of parts of the world. And because that airtime could be purchased in relatively small amounts, it was what really enabled large numbers of people to use mobile phones really quickly.

I had been working in East Africa for about a decade before that. I had also gotten married to another archaeologist and my partner is from Kenya. I had spent a lot of time there as an academic, an archaeological researcher, and also just as an inlaw to his family–just a general kind of observer of social life there. That kind of positioned me to sort of think about what I saw happening with the way people were using mobile phones from a personal experience of needing to connect to people, as well as thinking about it from an academic point of view, and from the point of view of an historian of technology. What happens when new technologies become available, what happens when people have a new medium, or a new way of doing the things that they already did before for long periods of time? That was kind of how I got positioned into studying all of this.

When people began using airtime to access mobile phones, oftentimes, especially in much of Sub-Saharan Africa, and in rural areas of Sub-Saharan Africa, people began to use what was often called the community phone. So one person in a marketplace would have a phone that was available for rent or temporary usage. People could get access to that phone by renting it out temporarily, purchasing their airtime, and then making those calls. A lot of people in Sub-Saharan Africa live in very flexible and extended family kinds of social setups. Oftentimes, parts of the family live in one city or community, and other parts of the family live in other parts of the country. This has to do with colonial histories of work, migration, and urbanization. So what happened was that people began to use the airtime as a kind of money. And what I mean by that is that, if they wanted to send money to a friend or relative who lived in another city, they could actually use that airtime code as a de facto currency that could be transferred between phones.

For example, if you had a code, you could text message that code to someone else. Then, they could input that code into their phone and either gain access or purchase airtime that way. You could also exchange it with a dealer and use it to rent out a phone. Or you could even barter that airtime code for goods and services if there was a merchant in a rural village somewhere who was willing to accept your airtime code as a form of currency. And this also has to do with the fact that oftentimes there’s not enough money, or enough liquidity, in many communities where airtime came to be used as one of the first digital currencies. So when mobile phone companies, engineers, and other specialists became interested in this phenomenon, they realized that by formalizing this kind of informal use of currency, that air time sending, and even text messaging, could eventually become a way of transferring money from one mobile phone user to another. Maybe I should stop here and see if that makes sense.

Scott Ferguson: Yeah, it makes a lot of sense. What you’re talking about, we in the MMT world call different degrees of moneyness. We might call them nested regimes of liquidity or receivability. So those airtime credits are mostly redeemable through this service, but then it takes so many people using the service that it gains a kind of wider receivability. Whereas, what you’re suggesting is that then there’s a moment when engineers are getting involved, and presumably private investors and other actors, where they’re starting to think about a Kenyan currency, or a currency of greater receivability that is linked with the government, presumably, and perhaps even in international regimes? Is that the transition you’re talking about here?

Sibel Kusimba: Sure. I think that would be one of them. It would be connecting this kind of informal, special currency into the bigger circulations of what we in anthropology call the general currency, which is the most widely available. It has the most functions and the most acceptability across different parts of the social universe. So that would be part of it. It would be about connecting it to a state issued currency. It would also be, I think, somehow guaranteeing that that process, that airtime code that you send, would be accepted on the other end. That it would have a value that would be standardized and accepted. Also, if you went to a particular place and tried to send money, you could somehow guarantee that the person on the other end would receive the money within a particular time. So those are all aspects of what it would involve to formalize the use of an informal currency like that.

Scott Ferguson: So can you talk a little bit more about, if I’m remembering correctly from your book, there’s a sort of new technology, right? There’s a technological shift in airtime. Can you talk about that part?

Sibel Kusimba: In order to really make this money transfer system workable, and to guarantee the value that would be sent from one person to another, the other important part of this is to create a way of transferring the form of that value from airtime into something else. In this case, that something else was the cash money, the sovereign currency of Kenya, which is the Kenyan shilling. The means through which that transfer is going to happen is the agent, the mobile money agent, who is really a human being who provides the service of accepting the airtime and being able to take that digital currency and then transform it into actual cash money. So that’s called the cash in, cash out. In other words, what happens today is that, if you have cash money, you take the cash money to an agent, and they give you a digital representation of that cash. Technically speaking, that’s what they do. They hold your money for it. They’re not a bank. So they hold the money for it and they give you a digital representation of that cash. Then, when you have a digital representation of that cash on your phone, you can use text messaging to send it to somebody else.

You could also pay for things. You could send it to a merchant. You can repay a loan these days. You can have interconnectivity with a bank. So there’s several new services kind of built on to it now. But the key thing was really to provide that translation between cash money and the so-called digital representation of cash. I think that’s a really important point. And M-Pesa is the name of the service. It is provided by the mobile phone operator, Safaricom. It is not like a cryptocurrency or any other kind of digital money. It is a digital representation of the sovereign money of Kenya. So it’s not a cryptocurrency. Sometimes people get confused about that. I guess you could say it’s a stable coin. But even then I’m not exactly sure if it would be a stable coin, because it’s technically speaking a digital representation of Kenyan shilling cash.

Scott Ferguson: And a lot of these terms, like stable coin, didn’t they emerge much later? I think they just developed.

Sibel Kusimba: Yeah, right. We’re sort of trying to retrofit this.

Maxximilian Seijo: As we’re traversing these nodes of receivability in this historical trajectory, I was wondering if you could spend just a bit more time talking about the transition between what you describe as the informal to the formal. Because obviously, as you’ve been describing, there’s all of this private mediation of this transference and of these exchanges, which then become, in a more direct sense, public, right? This money becomes, in a more immediate, formalized sense, public money, even though we would, of course, insist that it was always a form of public money just in a more privatized way. We’re wondering if you could talk a little bit about more about how that process happened in the movement from the informal to the formal?

Sibel Kusimba: So then you have to consider the really important role of the Kenyan government in all of this. The Kenyan government had resisted a lot of the neoliberal reforms and privatization reforms that have been ongoing in Africa during the 1990s. Kenya’s telephone services, post offices, and other important infrastructures were all government parastatals until 1999, because they were under a lot of pressure from international donors. In 1999, they broke up the parastatal that included the post office and telecommunications. It split those into two. It agreed to privatize the mobile phone service. So in actuality, what happened is that the largest, nominally private mobile phone operator in Kenya, is called Safaricom. It was a product of that privatization of a former parastatal. In reality, this Safaricom entity is 35% owned by the Kenyan government, 35% owned by Vodafone, which is a European mobile phone company. It also has a South African subsidiary called Vodacom. But anyway, that’s another 30%, which is a private corporation. Then, another third of it is shareholders who can be anybody.

So nominally speaking, it’s a corporation. It’s a publicly traded corporation that has shareholders and the whole nine yards. But if you scratch the surface, a large part is owned by the Kenyan government. There are also some very prominent, well known Kenyan families who are shareholders in Safaricom. They are also sometimes politically well connected families. So it’s a really interesting kind of situation because the whole story of M-PESA in Kenya is oftentimes heralded as an example of private sector development. It’s the idea that when a private corporation took over this infrastructure, what really happened was that this very hapless and inefficient parastatal had to whip itself into shape and become this incredibly profitable and super efficient corporation. In reality, it’s an entanglement of government interests, private interests, and international development organizations. It’s really a kind of tangled web of different interests, both private and public.

I think that’s important because the whole narrative about how innovation and development should happen and how money systems should be organized and who should oversee them and who should back them, is a really important question. I know that all of you probably know more about that than I do. So I’m excited to learn more. But I think if you look at this example that I talked about in my book as a case study, I think it’s a much more confusing picture than to just say this is an example of a free market success or something like that. One of the things I also talked about in my book is the important role that the Kenyan government, regulators, and central bank officials and so on, had in kind of taking an approach to regulation that would still allow some of these informal practices to be captured, and that would still allow for the rapid diffusion of the system. So in reality, it’s a kind of an accommodation of all these different models that really came together.

Scott Ferguson: So it’s not as clear a story as maybe the neoliberal take would have it. I think one of the things I really like about your work, too, is that you take a different route than those who would be interested in these systems, in terms of like financial inclusion, which from my perspective, and maybe you can correct me on this, seems to be almost a predatory term, when it could mean other things. There’s a sociality to money that you’re really interested in investigating. And I think that this stems from your anthropological training and approach, and perhaps your work with and through the anthropology literature on money. So could you kind of just walk us through what work is maybe most useful to you as you’re navigating these questions and doing this research in anthropology, and maybe even adjacent to it?

Sibel Kusimba: I found initiating this whole project, thinking deeply about money, and about what I was seeing and how to make sense of it, to be like the most challenging intellectual effort I’ve ever had by far. I find the study of money to be extremely difficult and very, very challenging. Everybody uses money, or at least almost everybody. People use it for all kinds of things because that’s the whole point of money. It should be something you can use for everything. It seems to have a whole range of meanings, and it’s not just meanings, but also things that people do. It’s practices as well as ways of thinking. So it’s really difficult to figure out just in the abstract, let alone to consider one historical place and time, which, again, makes it even more complicated.

But you’re right, the dominant perspective that I found, as I began to think about what I could contribute as an anthropologist, was this financial inclusion perspective, which is an approach that primarily uses development economics to think about why people do what they do, how can we alleviate poverty, how can we put more money into the hands of more people, and how can we sort of lift people up out of poverty. A lot of the approach in financial inclusion comes out of this perspective of expanding the banking industry as it exists now and trying to give more people access, especially billions of people who are considered unbanked or underbanked. They are not integrated enough into our financial system, either the national financial system or the global financial system, depending on how people want to think about this. The idea is about bringing these unbanked people into banking, or all the benefits of participating in our financial system should be expanded to more and more people. 

So almost everyone looks at an example like the story of M-Pesa, which is detailed in my book, as an example of a successful approach to financial inclusion. The critique of financial inclusion is that by bringing people into the financial system, we simply reproduce poverty and bring large profits to the financial services industry in one way or another. That’s the financialization of poverty approach, which I think is a very, very important set of critiques. There is a book by Sohini Kar called Financializing Poverty that is all about microfinance in India and the way that poor families are maintained in relationships of debt, essentially like debt servitude. One of the issues with microfinance is the fact that the hundreds of millions of people who rely on it aren’t really starting businesses or moving ahead. They are simply using loans to kind of maintain a life of poverty that they already have. So that’s a really, really important critique.

On the other hand, I wanted to sidestep that a little bit. I wanted to write about this differently, not that I don’t think that that has an important lesson for the story of Kenya, but because I didn’t want to take away this money from the people. It seemed to me very much to be a money that had been created by the people who are using it, and that still bears the stamp of this informal set of meanings. It’s been enfolded into very long standing financial systems and ideas about value. And rather than supplanting those, I feel that it has folded itself into those and in some ways enhanced ideas about value and ways of continuing traditions about value that make it more than just a kind of predatory system. Although, I think that aspect is also part of what’s going on. So I didn’t want to take this away from the people who had used it and invented it.

In fact, there’s a series of urban legends all about where M-Pesa came from. It’s interesting that the kind of Silicon Valley myth about M-Pesa is one thing, but Kenyan people have their own ideas about where M-Pesa came from. There’s a really widespread story that is told about a university student who invented this system, and then had his patents stolen by the phone company, or by the British subsidiary–some powerful entities stole this from them. This kind of storytelling lives on. I use that as a kind of example of the way in which people still claim this as their own money. And it has a whole set of local meetings that tie into very long held ideas about value and about family life and about the life cycle and other things that are very important in the anthropology of this part of the world. So I wanted to make sure that it wasn’t portrayed as a kind of imposition in its entirety.

Scott Ferguson: Yeah, that’s great. That’s one of the things I most appreciate about your book, which seems very fitting from an anthropological perspective, but to come at money from a critical perspective and a critical perspective in the humanities, maybe outside of anthropology, very typically the impulse is to see money as evil, as bad, even if you’re dressing it up in fancy terms. And part of that evilness and that badness implies a kind of evacuation of meaning, an  evacuation of being concerted, and an evacuation of ties and obligations that are rich, complex,and entangled.

Sibel Kusimba: Sure. So I guess you could start out with the forms of money that have always been important in this setting. An example of early work that I really liked is the work of the anthropologist, Harold Schneider, who worked in pastoralist societies in the 1950s and the 1960s. Pastoralists are, in this case, cow herding societies, but also goats and sheep. Most anthropologists consider pastoralism to be like an environmental adaptation. Like if you live in a grassland and it’s too dry to farm, then you will become a pastoralist. You will keep cattle, sheep, and goats and, for a lot of these societies, milk. Not just the meat of the animals, but the milk of the animals is a really important part of their diet and so on. But what Schneider did was to see pastoralism not really as an environmental adaptation, but as a political economy based on their cattle as their main monetary system.

So for him, it was about having a form of money that was like a naturally expanding money supply, because their money just had babies all the time. They almost had a problem with too much money, because the ability of one person to care for, tend, feed, water, and herd animals was limited. There are only so many people in a household and so many hours in a day. So as people’s money expanded, and their cattle had babies, they came up with ways to circulate the money. And they created financial ties that allowed them to kind of lend out the cattle to various factions of the society. So the society became kind of knitted together by all these exchanges of cattle, because, basically, they had too much money, which I think is kind of cool. I thought that might have something to do with MMT. I don’t know a lot about MMT. But it kinda reminded me of MMT in the sense that you just have all this money that is like bountiful. Because we have all these beliefs about how the value of money comes from it being very scarce and not having enough.

So this was a society where there was too much money. So what people did was, by creating all these financial ties, they had a political economy where they accumulated financial ties rather than accumulating money. So the people with the greatest wealth in the community were the people who had the most financial ties. They did this through bridewealth and through all kinds of institutionalized relationships around the rights that they shared to each other through these exchanges of cattle. Those are still really important. And bridewealth cattle are still exchanged at all kinds of rituals. Normally, at different parts of the life cycle, you mark your transition from childhood to adulthood, or into elderhood. And there are exchanges of cattle and new kinds of relationships that get invoked at each of those times.

What I learned in 2014 and 2016, was that these mobile money remittances were enabling and sustaining some of these traditions. If people in urban areas who had access to work could send money through the mobile phone, it would only be used by people in the rural areas to fulfill some of the expectations of these rituals, purchase cattle to be offered to the ancestors, and kind of build a tie between the present and the future and so on. So I think that would be a really good example of how money is not this depersonalizing imposition onto people, but that it gets wrapped into the forms of money that they already have. And especially in East Africa, people have been historically very interested in wrapping new forms of money into the hierarchies of money that they already have. 

And that idea that you mentioned, Scott, that money is very depersonalizing, it is also reflected in a lot of early anthropology. It’s the idea that if people have to pay for things, they won’t have the same value that they had before. I think that’s certainly not true. Now that people purchase the animals that they’re offering to the ancestors for sacrifice, in a way, it makes them even more valuable to people, because people who don’t have a lot of access to cash money have to coordinate the circulation of all of these digital money remittances in order to cobble together enough contributions to purchase the animals. And when they’re able to do that, it kind of provides that family with a sense that they have accomplished the expectations of the ancestors, their traditions, and so on. So I wanted to make sure that that was a part of the story of all of this. Gender is another area that ended up being really, really important to me in this book.

Scott Ferguson: I know you spent a lot of time thinking about the way women are using this currency in Kenya. What are some of the lives, the rituals, the relationships–how is mobile money coming to them and mediating them? Could you maybe just provide an example or two?

Sibel Kusimba: Gender is another big part of financial inclusion. If you look at what was known previously to my research about gender in this area, women have been a huge focus of the financial inclusion effort. In other words, if the unbanked people all over the world need money, then the unbanked women of the world need this money even more. Women are sort of the representation of a vulnerable, third-world type of person who is believed to be the target beneficiary of these new forms of money. I also tried to turn that idea on its head just a little bit. I tried to show that women are really important in this story because of the kinds of relationships they have with money and the kinds of relationships they have with each other. There’s a certain theory of trust that a lot of women seemed to articulate to me and a theory of relationships that seemed to fit into this idea of financial ties as being really important to people.

Part of the reason why money was so challenging for me to study is that, methodologically, it’s very challenging and it’s very difficult for anthropologists to study. In this part of the world, people don’t necessarily have an idea about the individual as being a bounded, detachable, and separate entity. People tend to see individuals as very interconnected. I think it goes back, possibly, if you believe Harold Schneider, to this interconnectedness that comes from the fact that they just have so much money they don’t know what to do with it. They have to kind of bind themselves up with other people. So when you talk to people about money in this setting, because they don’t necessarily believe in a detachable individual as much as some other people might, people here tend to really personalize money. They view it as an extension of themselves. And whatever they do with money, they really view it as a representation of who they are, what they want to accomplish, and what they want to be to other people.

So when you send money to someone else–and again, the whole money system is based on these remittances that go back and forth over mobile phones–you’re showing them what kind of person you are. You’re showing them that you care. You’re showing them that you want to be present in their lives, even if you can’t physically be there. You can kind of be there through these remittances. You’re really expressing a lot of important cultural ideas about belonging, about obligation, and about filial piety. And really, you can’t be a person anymore in Kenya unless you are able to use this money system. It’s become that important to people. It’s become like a new imperative, or like a new basic expectation of personhood. And because of that, in a way, it’s hard to study the downsides. Because if you ask people, “Who do you send money to and who sends money to you?” people will answer relatively enthusiastically. It’d be like asking, “Do you have a lot of Facebook friends?” or, “Do you have a lot of Twitter followers?” You’d be like, “Yes, I have a lot and that’s my wealth in people. Those are my people.” They are the relationships that I’ve been able to create by sending and receiving money.

But the downside of all of this is that there is so much disappointment and so much failure that can happen when you don’t have enough money, or when you’re unable to help someone or fulfill the responsibilities of a firstborn son, for example, who’s expected to sustain and support others. Because it is so weighted with obligation and social meaning. It is so personal to people. It’s very hard to talk to people about what it means when they cannot send money. And in reality, that happens all the time. To be in Kenya today means to be constantly negotiating requests from people in your social networks. It’s still a society where people don’t have enough money. You can be as digitally connected as you can try to be, but if the social networks don’t have any money in them, then they can’t circulate value that they don’t have. So there’s a great deal of negotiation that goes on to try to mediate some of the jealousies, the hurt feelings, and the downsides of this money, because it is so weighted and loaded with meanings for people. 

Another thing that women oftentimes have to manage is the emotional labor of all of these remittances that circulate in families. One of the methods that I commonly use is to create maps that show how money circulates in families. These maps really show a social infrastructure, so to speak, of how the money moves around. Women are really important in a lot of these networks. They sit at the center of remittances. They are oftentimes considered the most trustworthy and the most fair brokers of remittances. So they are often the ones who have to figure out who needs money and try to get money to people who need it the most. It can be a relationship that gives women a lot of social importance. It can give women a role of importance in their communities, but at the same time, it also gives them a kind of a burden in a way by having to deal with managing the emotional weight of all of these decisions. So really, the position of women is kind of a double edged sword, because while they’re often very central to these networks, they’re often people who have to manage and mediate all of the difficulties that people have in accessing money and moving it around.

Maxximilian Seijo: So what I really like about all the rich detail that you offered in that answer, and there’s so much to pick through and to think with and about, is it perhaps resonates in the way that you saw it mapping onto MMT and a little bit of the work we’ve been doing with Money on the Left. I’ve been doing some of my own reading of anthropologies of money in different places around the world. I think what it speaks to is a relational view of money in a way that, as Scott mentioned, rejects the top-down imposition story. All that texture, all the tensions and the complicated relationships between people, the ways they are navigating the obligations to others, and these ties that you’ve described, offers a really interesting story of what maybe I’ve started to call the condition of possibility for money.

This is the way in which people with various forms of agency and background can make money, and not in some individualist way, or what we would traditionally call a bottom-up way, but in an overlapping way, and how those forms of money making are political. They can reach all the way up to the officially formalized currency systems that ultimately allow for a universal receivability, but then also a structure of production within that. So there are these layers of money and layers of production that all ultimately map into a wider form, or in this sense, the state form of the Kenyan shilling, and all of the production that falls under the purview of that and all of its dependent ways. And I offer that because it seems to be the way in which, especially lately, I’ve been trying to think with money as an anthropological form and a legal form in all of these overlapping ways. I just wanted to note it because it resonated so potently with this story that you’ve told. Moving from that comment to perhaps a further discussion of the work, aside from reflecting on that long monologue, we’re wondering if you could then start to move into some of the questions of visual culture that play an important part of your book?

Sibel Kusimba: No, thank you for these insights. It’s really fun to talk to people who actually know so much about this, so thank you so much for this and for these really great questions. To kind of start that out, I was really influenced in writing this book by the sociologist, Viviana Zeliter, who has written several books, one called The Social Meaning of Money, and then another, which she wrote in 2005, that is called The Purchase of Intimacy. It is about the relationship between money and intimate relationships. I found both of these books to be really, really stimulating, especially The Purchase of Intimacy. In that book, she really does articulate this relational view that you mentioned. What she says is that we have to stop dichotomizing the social and the economic. We have to stop assuming that these are always separate spheres. And this is a very long debate in anthropology.

There is this very long standing tendency to think about economic behavior–and by that, I mean rational behavior or efficiency type behavior–as somehow antithetical to emotional relationships, or to socially positive relationships. In her view, the social and the economic are always constituting each other. And money is a mediator that creates a certain kind of relationship. Rather than trying to think rationally about money and shift all of our emotional and personal commitments to the side so that we can be rational and efficiency seeking, she argues that there is a kind of social and emotional content to all the relationships that we produce, and that there is some medium that creates those relationships with some kind of value. It could be money, it could be another kind of value that creates that relationship. So then the economic and the social are always together.

I think that is a really powerful idea because in anthropology there have been all these debates about whether rationality is universal. Or does the economy have a social and cultural embeddedness? Can we see economic behavior as a universal thing that occurs whenever we get all the emotions out of our heads and just try to be rational? This is just not a productive dichotomy. She really sees how money is a mediator that creates a certain relationship, so that it is both social and financial at the same time. And as I was doing these maps and drawing the money moving around, I wanted to go back again to this idea of technology, to get back to where we started talking. Digital money that’s on a mobile phone is a new form of money that has a particular material basis to it and that is a medium of a relationship. I wanted to see it as fitting into other media of exchange, or other media of relationships.

So again, this is not the financial inclusion perspective where this new form of money just moves in, displaces everything, and replaces everything. This is an additive process where new relationships are perhaps formed by and with a new mediating technology, which in this case, would be digital money. Again, I was struggling with how to talk about money with people. It’s deeply personal. Sometimes really negative emotions, like shame or failure, are very close to the surface when you ask anybody about money. So by using the drawings, I was able to communicate a little bit non-verbally with people about what money means to them. And by having them draw the character of money, I got a sense of how different mediations can occur. This kind of happened accidentally, because I was trying to talk with one of the women who was helping us with this. I was trying to talk with her about digital loans. I have to explain some of this a little bit to start out with.

Now that they’ve got this money sending system–and again, the idea is you go to an agent, especially in the rural areas. You don’t need a smartphone and you don’t need the internet. You go to an agent who creates this transformation from cash to a digital representation of cash, or back again. You can go from cash to digital money, or go back again. That’s how you can send and receive money and that’s the inclusion aspect of all of this. But on top of that, all kinds of financial services are being built onto this structure. East Africa, and Nairobi in particular, is a real center for “feel good, do good” innovation, or solving social problems and improving the infrastructure of developing countries by using all kinds of digital technologies and innovations that bring development. So now that you’ve got a payment channel that uses digital payment, you can do things like have people pay for solar panels, or have people pay for water, or have people pay to watch cable television, and things like that.

You could also perhaps provide them with information about health or medical services. So really, the digital payment is supposed to be the rails on top of which all kinds of commerce and service delivery are going to reach into especially rural people who maybe off the the grid of the kinds of infrastructures that countries like Kenya inherited from the colonial experience. One of the biggest services that’s had really rapid uptake throughout Sub-Saharan Africa are these digital loans that are available over the mobile phones. They have names like, Baraka, which means right away, and other kinds of things. You can get a loan over the phone for as little as $10. And if you repay that loan within this timeframe that you’ve been given, and it varies depending on the provider, then the next time you seek out a loan over your phone, you can get a slightly larger amount. The idea is to build a credit history and access to credit using these mobile phone loaning systems. Sometimes they’re called nano loans or digital micro loans. They have been hugely popular. In Kenya, which is a country of say 40 million people, at least 3 million loans are taken out every month.

And that’s just from the main bank that is partnering with the mobile phone company, but there are more than 20 other providers that have come into this space. Some of them use a smartphone. They are more looking for the urbanites, or people that have access to internet and a little bit more money so that they have access to things like smartphones. It has been an example of how financial inclusion can so easily go awry, especially when unregulated products like this are offered to people who may not have much of a credit history, may not have much of an ability to pay back loans, and oftentimes live in very precarious circumstances such that they need money right away. A lot of people have had real problems repaying their loans. Large numbers of people have been blacklisted because they’ve been unable to repay. A lot of the companies that came in with the idea of providing credit to people, some of them have had to fold, such as the company called Tala, which had this dramatic uptake of many people taking out loans. Then, the Tala company recently folded and is no longer offering loans. I think it is into Bitcoin or some other thing right now.

So one of the really big stories, in terms of African FinTech, has been these digital micro loans. And they’re kind of shrouded in shame and secrecy. A lot of people can’t really repay their loans. They need to go back to their social networks and put together all the social relationships that they have in order to try to repay the loans. A lot of people get mired into debt. And once they find their way out of it, they don’t use the services anymore. They go back to what they were already doing before. So I was trying to get more information about these loans. This lady who I was talking with said, “Well, there’s a cat over here looking for scraps. These loans are like this cat over here.” Or even worse, these loans are like a rat that hunts for money. What she was sort of alluding to was the very private nature of these loans and the dangerous moral qualities that a lot of people find with this private access to credit. The thing is that, because people’s social relationships are so important to them, it gives people an incentive to try to take out these loans.

Oftentimes, their friends, their neighbors, or their family members are facing medical crises, or their children are sent home from school because they don’t have money for fees, or they just don’t have food. To be the person who can save the day and provide money when it’s needed in your network, it’s very important to people to have that kind of relational strength. But what it does is make people very vulnerable to debt and it mires people into debt. And what is happening is that, after a very rapid period of expansion, a lot of these digital credit providers are folding, or they are no longer as popular as they used to be. What people are going back to is, when you say conditions of possibility, what we would call the kind of informal sphere and the relationships that people have kind of developed around money outside of the banks, or outside of any other formal system. There’s a huge expansion in that area right now. Part of it has to do with the way people are bringing the digital payment system, bringing the remittance capability of the phones, into a variety of group methods that they have been developing over the years, which involve all kinds of ways of circulating funds in small groups, such as merry-go-rounds and table banking.

It’s really common to access credit from your neighbors, or from women’s groups in your neighborhood. They pull money together and often offer small loans to themselves, or even to other people that they know in their neighborhoods. There are all kinds of group models, like welfare associations, that are just really growing enormously right now as a result of the digital channel–making those payments easier for people to mediate time and space and maintain connection to those groups without having to be physically present. So it’s really interesting. The real growth has been in the informal sphere, precisely because people have that relational view of their money. They really see themselves as interconnected with other people. They see this as a fundamentally group process, not as an individuated way of dealing with money. And this is the real mistake that a lot of the providers are getting into. It’s much easier for them to deal with an individual client or individualized customer. Then, they know who’s responsible for their loan or whatever payment. Then, they know who they’re dealing with. They can do things like double check your identity and make sure they conform with banking regulations about KYC and so on.

But what they’re really doing is ceding a variety of groups and collectivities that basically circulate money amongst themselves. That’s actually the real basis of this money. So the formal sector is really trying to test the limits of people’s ability to repay loans. In a way, they’re trying to extract value from people who earn very little money through these tiny nano loans of $10 or $20. In my book, I talk about people who have access to between $10 and $40 every month, and they’re running around trying to find friends, agents, and others who can help them repay their loans on time. They’re repaying amounts of money that to many of us would seem to be ridiculously small. Some of them are being blacklisted, because they can’t repay loans that are as small as $20. So it’s a real failure to appreciate a different way of looking at finance. It’s an insistence on individuating the customer, on slotting them into a kind of repayment gradient. And it’s a real failure to appreciate that when people come together, save money together, and create money together, they can actually create large amounts of money when they circulate money in these groups.

And I give some examples in the book. When people want to get married and they need bridewealth, or when there is a real medical emergency in their networks, they can sound the alarm and come together with huge amounts of money, hundreds of dollars. People in rural areas can really come up with hundreds of dollars when they want to for the things that they think are important. And all of that is actually taking place outside of their formal offerings. In reality, I guess it’s a little bit of a meld. It’s a meld of these formal systems and the kind of informal logics that people wrap those capabilities into. Another thing I argue in the book is that, if people could expand their idea of what a credit worthy person is, if people could see themselves as ceding networks and groups and becoming a member—could a bank or a financial services provider see themselves as a member of a group rather than always trying to kind of individuate people and measure people according to outside standards–then I think they’d really see all the untapped potential that these groups actually have.

Maxximilian Seijo: I really appreciate that answer. One of the main takeaways of MMT that flashes in my mind when you were talking is the terms of loans in general as a matter of the public nature of money and the abundant status of money. You don’t run out of money. You may run out of resources, people, or other sorts of things, but money, and importantly, repayment–the variables around repayment and what needs to be “paid back” in any form of lending, or in any form of money issuance–is a political decision. So the austerities, violences, and predatory extraction that you’re describing, with the relational view of money in hand, they are not the natural order of the way money issuance, lending, credit, and debt have to operate. There’s a politicization of their austere premises, which I think is in part what your work is doing and what the associative monies that you’re talking about, that are more of a meld of the system, are also attempting to do. It’s about the terms of labor relations and credit relations that don’t necessarily fit into a reductive sense of what one might call the larger system, even though they necessarily are participating in that larger system in a mediated way, as you’re describing. And what’s so interesting about this is another way of viewing how the austere political decisions around lending also aren’t totalizing, and how public agency on behalf of people in groups and associations can challenge them in different ways. And then, of course, importantly, they also challenge their premises. Because they don’t have to be that way, according to MMT. That seems to be one of the takeaways from that answer and from your work. I really just find it so fascinating to work through and navigate all of these questions of how individualization and individual indebtedness itself is a political decision on its own terms.

Scott Ferguson: Maybe we can move to close out our discussion by getting you to tell us a little bit about how you see the future of these mobile payment systems evolving? Are there any kinds of formalized challenges? Are there groups who want to abolish the system or change the system? Do they have ideas about reform?

Sibel Kusimba: Thanks, this is a really great question. I think the systems, especially the formal money transfer system that we’re describing, M-Pesa and related systems, are almost 15 years old now, because the first kind of deployment, at least in Kenya, started in 2007. After a year, there were three or four million people who had already signed up. So it was wildly successful. And everybody thought that there would be this massive growth in new kinds of financial services, all aimed at low income customers that would really help them empower themselves and move out of poverty, or just create better lives for themselves. After 15 years, I think it’s fair to say that that massive growth has not really materialized, even though many people still use the money transfer service. Indeed, most people use the money transfer service. Participating in money transfer networks has really become imperative and necessary for social belonging and for economic life in general.

Having said that, the development of all kinds of new platforms, apps, and this “a thousand flowers blooming” of all kinds of digital tools and platforms that would be beneficial to people hasn’t really happened. In the existing system, there are a lot of ongoing problems. One is they are still not very affordable for a lot of people. There are very large fees for the transfer. In fact, when you upload your cash and create that digital representation, you have to pay money. Then, when you download your cash and go from digital representation to cash, on the other end of the transfer, there’s a fee associated with each one of those services. So for a lot of people, the services aren’t affordable. What I talk about in the book is the ways in which people use their social relationships to try to gain access. They borrow phones, or they know they have friends who are agents, or they work around the very high cost of the services. They’re still too expensive for the low income people. There are issues with trust because there has just been an epidemic of fraud, of identity theft, and all kinds of problems with trust in the system. And that oftentimes prevents people from using it. It prevents people from really trusting the system. 

Then, there’s the ongoing problem of just the lack of relevance that a lot of people see to a lot of the products that are given. The attempt to build on top of the digital payment, to offer things like health insurance, would be a good example. In my book, I give so many examples of people who are dealing with medical crises–one medical crisis after another. One man was a carpenter and his four year old son swallowed a nail and needed to go to the hospital right away. Again, they did a massive fundraiser and people responded right away. Because almost all medical care is kind of out of pocket in Kenya. Even relatively wealthy people don’t really have access to enough insurance. So medical care is a big problem. People don’t have access to schooling. People don’t have adequate food and the ability to sustain consumption. So all the products that have been developed to try to meet a lot of their needs, people just don’t feel are relevant.

To go back to the issue of insurance, numerous companies have tried to scale like a digital insurance product. If you pay a small amount of money, then when there’s a medical need, you’ll be covered. People don’t trust the service. They think that that coverage won’t really be there when they need it, or they just don’t have the money for something that they’re betting won’t really happen. Also, because they know that when they do have an emergency, they have their informal networks of people that they really do trust and know will be there. So it’s the trust, the affordability, and just the lack of desire to partake in the so called benefits of finance. The scaling up and so on hasn’t really happened. Instead, what is happening is the growth of all these informal groups and models.

One thing that’s really interesting in Kenya is that the co-operative movement is very strong. There’s even a university called the Co-operative University of Kenya, where they actually teach people how to create co-operatives amongst themselves, such as co-operatives for farming or different kinds of agricultural production, but also financial co-operatives. People who work together, who are teachers together, form cooperatives. There’s a range of formality of these groups. Some of them might resemble a credit union here in the United States and others are less formalized, but the government recognizes a whole range of different kinds of co-operatives. So it’s a huge area of growth. That’s the place where you would find alternative financial forms and the place where you would look for new kinds of finance that are truly going to be relevant for the people who are using them. In terms of more digital financial offerings, especially things like predatory loans and so on, I predict that those are just going to create new forms of exclusion, rather than really benefiting people. So in a lot of ways, that’s what the future looks like right now.

William Saas: Historically, it seems possible for someone coming from doing anthropological work in an area around financial inclusion that it would be cause for concern. That’s not what you’re doing. It seems like you’re more on the side of illumination, optimism, building, and that your work is certainly not contributing to, but maybe helping to anticipate and route the exploitation you’re talking about. Thank you so much, Sibel Kusimba, for joining us on Money on the Left. It’s been a pleasure.

Sibel Kusimba: It’s been an enormous pleasure. Thank you so much for your interest in this work. How exciting to meet people who have similar interests, and it’s been a huge pleasure for me to be here today.

* Thanks to the Money on the Left production teamMaxximilian Seijo (audio editor), Richard Farrell (transcription), & Meghan Saas (graphic art)