Political economy of financial inclusion in Lesotho: Mobile money and the experiences of low-income and rural communities
Abstract
This paper examines the development of mobile money in contemporary
Lesotho, 2012-2020. Using historical and ethnographic sources, it situates
the development of this mobile phone-based financial system within the
broader economic history of the country. It adopts a political economy
approach to analyse the emergence and evolution of mobile money as an
instrument of financial inclusion used by the government of Lesotho and
international organisations. The paper advances that when operating with the
logic of capitalism, free market policies, emergent mobile money networks are
hierarchically structured and privileges enterprises and corporations with bigger
financial muscle. The majority of small agents, the Basotho entrepreneurs, are
marginal and have to operate precariously with limited capital and low cash-flows
to ensure efficient services for the people. As a corollary to this, the rural
poor are further excluded and exploited by the agents. A general assessment
advanced in the article is that the rigidly defined digital eco-system is geared
towards integrating the lower echelons of the economy asymmetrically into
the mainstream financial economy dominated by corporations. However, this
cannot be defined as any meaningful financial inclusion.