Some thoughts on community based models for sharing costs

We found that the key factor that makes 'prepaid' payment plans
(whether its for electricity, mobile phones, water etc) so attractive
to the BoP customer, in the context of their own behaviour patterns
regarding the management of their personal finances. This is the fact
that this model puts significant control over time – frequency and
periodicity and money – varying amounts, in the hands of the customer
and thus fits in with their need to manage their varying cash flow from
multiple income sources with a great degree of flexibility.

Furthermore,
among rural communities in the low income demographic, trust or social
capital – that is, the community ties and social networks – plays a
significant role in the success of existing informal yet traditional
means of borrowing, lending and sharing wealth and expenses.

Therefore, our analysis of the user research conducted across BoP communities
who manage on irregular income streams and the subsequent synthesis leads us to conclude that payment strategies most likely to succeed
would be those that are:

  • Flexible
  • Robust
  • Self sustaining
  • Involve the participation of the community in the decision making

AND critically,

Places significant control over the actual timing of the payments and the amounts paid in the hands of the participating community.

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