The hidden cost of doing business #informaleconomy
This looks like its a low cost business operation with low barriers to entry. All you need to do is find a decent tree under which to display your wares. The reality is that these entrepreneurs have numerous fees and costs that they must pay in order to do business, regardless of how informal it […]
There’s more to informal trade than meets the eye
This photograph captures the way micro entrepreneurs in the informal economy perceive their business. There is more here than meets the eye at the first instance. Note the green logo of the Kenyan mobile money transfer system M-Pesa in the background of the cash transfer taking place, by hand, in the foreground. The customer is […]
Changing flows of trade
This unassuming pile of clothes caught my attention on market day in Busia, Kenya. They are mitumba (secondhand clothes) from India. This is a recent development, apparently, as traditionally mitumba tends to come from the ‘west’ (as can be noted by the name on the bag shown below). Clothes sourced from India have begun showing […]
Is Uganda’s rural, informal economy helping people climb over the poverty line?
I stumbled across this dataset on the World Bank’s open data website yesterday, and couldn’t resist making a table to convey the message. Uganda’s poverty headcount halved in the decade between 2002 and 2012. Their statistics are rated well enough that this doesn’t seem to be too far off the mark. In the three years […]
Is the pay per use business model changing household purchasing dynamics?
The process of writing the previous post on India’s energy efficient cook-stove development efforts made me pause and reconsider my assumptions. Here’s the snippet that struck me in the article. Philips took its India stove to more mature markets in Africa, where a raft of foreign-funded stove projects had familiarised customers with the product. This […]
Finally, the silver bullet of micro-finance can be buried in peace
Six years ago, in March 2009, after my return from The Philippines where I’d first conducted fieldwork using design ethnography methods to understand household financial management at the erstwhile Base of the Pyramid in a rural region, I had written: Another eye opener was hearing the story about a micro-finance loan for enabling local women […]
When would you buy life insurance for a week? New products for the informal market
A South African company has figured out the back-end technology required to provide easily accessible prepaid or pay-as-you-go insurance products that can be serviced via your smartphone. Their solutions are designed for the unbanked, informal trader, typically living on an average household income of US$8 a day. At first glance, I wondered who on earth […]
The formal sector and economic development: A lesson from marketing
Pursuing the thoughts introduced in the previous post further, I looked up the original reference on “formalization of the informal sector”1. Alan Gelb, et al. 2009. “To Formalize or Not to Formalize? Comparisons of Microenterprise Data from Southern and East Africa.” CGD Working Paper 175 “…in East Africa, weak enforcement of tax payment and no […]
Old and New: Changing Perspectives on the Informal Economy
Martha Alter Chen’s table summarizing the still prevalent yet now considered obsolete view of the informal economy, against the revised perspective currently held is worth showcasing in its own right. Further food for thought comes from this little snippet from Sparks and Barnett: Gelb et al (2009) found that the “…productivity of informal firms is […]
Cross-border mobile financial services in Africa are going to be huge
Analysis Mason has an excellent article on the next big thing in mobile money across the African continent – cross border payments. I covered the emergence of these services, through regional operators as well as partnerships based on interoperability earlier. This is what I asked for: Mapping it all I’d love it if someone could […]
