Four years ago – while working at Accenture – I began my first project with the Accenture Development Partnerships in Tanzania. My role was to build personnel capacity for the Ministry of Health’s supply chain arm, and to develop public-private partnership between The Coca Cola Company, Global Fund and the Gates Foundation. Since then, my passion for the role of business in development has grown and I managed a few other social impact consulting projects with Accenture Development Partnerships. After these experiences, I decided to do my MBA at Saïd Business School, Oxford and to use the year to think of how I could apply my business experience to international development in a more integrated way.
Thinking about the various challenges faced in international development, I realised that often people’s behaviours present the biggest challenge to development, especially in terms of their acceptance of the tools and practices that are easily available and have the biggest impact on changing lives. For example, changing people’s hand washing behaviour does not require expensive inputs, but it has the potential to prevent various infectious diseases that currently kill millions of people. It became clear that behavioural change, more specifically the ability to influence behavioural change, represented a huge opportunity.
Changing behaviours is often a hard, timely, and costly process. However, an intervention that could be very effective and at the same time cheap given its potential impact, is the use of mass media for behaviour change. Most people in developing countries have access to at least one type of mass media — mostly radio, with mobile phones catching up. Through the use of mass media, it is possible to deliver important messages that foster development in an entertaining and engaging manner. The effects of this can be both in terms of people’s perceptions and on a subconscious level (as opposed to pure educational, instructive, or logic-based messages).
In the pursuit of wanting to learn more about the role mass media can play in changing people’s behaviours, I was able to use the Apprenticing with the Problem grant from the Skoll Centre to spend two months working with Development Media International (DMI). DMI is a London-based non-profit that runs a fascinating range of projects using mass media campaigns to affect behavioural change around the world.
A MASS MEDIA METHODOLOGY
There are quite a few organisations that specialise in using mass media for behaviour change. Many of them target behaviours around health, family planning, education, etc., and often work as part of larger development programs sponsored by the donors like the World Bank, DFIF, USAID, Gates Foundation, etc., that have a behaviour change component.
DMI’s differentiator is that they use a very rigorous approach to impact measurement and evidence collection. The organisation is trying to answer the same question I had been asking myself: how effective is mass media in changing certain types of human behaviour? To answer this question, DMI conducted a thorough assessment of each of its programmes, and is currently conducting a large multi-year randomized controlled trial (RCT) in Burkina Faso, focusing on reproductive, maternal, newborn and child health (RMNCH). The midline results published earlier this year have shown significant changes in some health-related behaviours as the result of the campaign.
The format that DMI found the most effective is the use of 1-minute drama spots broadcasted multiple times per day, and a longer-format evening talk show with a call-in component. The methodology DMI uses is called Saturation+, and it has three pillars – Saturation, Science and Stories. Saturation means broadcasting spots multiple times a day (10 times via radio, 3 times via TV), in local languages and using the most popular stations/channels – to cover the largest audience. Science means using comprehensive qualitative and quantitative research tools to predict, maximize, and measure the impact of the campaigns; and to plan the campaigns in the most impactful way possible. Stories means convincing people to change through developing locally relevant content and highly entertaining stories that resonate with people.
I was smoothly integrated into DMI’s small London-based team, and was kept busy throughout the whole two months working on various initiatives. My time at DMI enabled me to get exposure to the various aspects of running a small company in the international development sector and also continue to explore my passion for the work.
It was a hugely valuable time for me where I was able to use my existing skills as well as learn a lot of new ones. I used my strategy consulting experience to help DMI’s management to review the organization’s strategy and positioning. I helped to design an approach to several of DMI’s new programme areas, including: early child education, tuberculosis and road safety, as well as doing business development to scale up DMI’s existing programmes. The highlight was being asked to conduct a feasibility study for a new potential DMI’s campaign on agriculture where I spent a week in Rwanda doing field research and exploring opportunities with potential partners and donors.
Good ideas tend to cross borders quite easily. This is especially the case with technology. We can easily observe the convergence of new technologies across borders in almost any part of the world. And the reason is simple – the convergence of technologies is empowered by technology itself. Furthermore, technological breakthroughs increase productivity while lowering costs and this quality makes them easily adoptable by new geographies. One such technological breakthrough is FinTech – which is simply to say technologically empowered financial services. Just to give you an idea, technology today can do most of what banks or other financial service institutions do. A basic example is balancing your check book online instead of waiting in line in a bank.
The Power of FinTech
The idea of technology powered financial services has the main quality of a technological breakthrough – it increases productivity while lowering costs. And this is just the tip of the iceberg. FinTech is literally revolutionizing finance – from new scoring models, to giving opportunity to regular people to take part in what only Investment Banks were allowed to partake. As such it has been spreading geographically on exponential basis. Every day a new FinTech product becomes available that changes the way we interact with finance. Everyone, from the general public to investors are hooked on this new industry. However, if you look the map of Europe, there is one region that has had zero activity in the FinTech space. This is the Western Balkans, or more precisely, Ex-Yugoslavia countries. Two members of our team being born and living in the Western Balkans their entire lives found it curious why this phenomenon, that is positively influencing the rest of the world, has overlooked this geography. With the help of the Skoll Centre of Social Entrepreneurship and the Said Business School, the team spent six months in Serbia, conducting in-depth analysis of the Serbian financial market and its readiness to accept FinTech innovations, specifically P2P lending.
The research focused on the P2P Lending industry as a global phenomenon, the history and the current state of the financial industry in the Balkans, the ways P2P Lending can be introduced in the region, the barriers that have kept it out, and the benefits that these countries can have from it. During the six months the team did hands on research, engaged with some key stakeholders in the Serbian finance sector (such as banking professionals, government officials, high net-worth individuals, etc.), and took part in the LendIt Conference in London, the largest P2P conference in the world where it had chance to meet industry experts from all around the world. The key findings will be outlined bellow, accompanied with an infographic for the more visual readers.
Global P2P Lending Findings
P2P lending is a global phenomenon that has experienced enormous growth over the past five years. It can be established as one of several operating models all of which have a more cost efficient structure than traditional banking. The regulation for P2P lending varies across different countries. Finally, P2P lending offers many benefits including: no inherited systematic risk, access to finance, and it Is a new asset class.
Analysis of the financial sector in the Balkans
The financial sector in the Balkans remains to be hugely underdeveloped and it lags behind the financial sectors in developed countries. Commercial banking is the only developed sector in the financial industry in the Balkans. The key challenges to the development of the financial industry in the Balkans are:
Low level of saving
Conservative lending by commercial banks
High borrowing costs and low deposit returns
The legislation in the financial sector in the Balkans is set up to protect the banking industry
P2P Lending in Serbia
Given the local landscape and the key factors to P2P lending two operational models can be set up in Serbia
Partnership with a bank
Fee based model
The revenue model for P2P Lending in Serbia should not be much different than that in the US or the UK. The borrowers market can be split in consumer and business, while the consumer market consists of all the household loans issued by commercial banks, in addition to all the loans not issued due to conservative banking. The business market should focus on working capital financing – invoice trading. The research has shown that the following are the essential areas of activity that must be performed well if P2P lending is to be introduced in Serbia:
Credit risk modelling
The matter of trust
Overall, our view of the market is a positive one and our assessment is that there is space for the FinTech industry. We expect that some form of alternative finance will emerge in the Western Balkans in the near future, and in expectation of this we will continue our work on bringing P2P lending in the region.