A Study on the Use and Benefits of Technology to Promote Youth Savings
This case study assesses the use and perceived impact of technology that was used by credit unions to promote the financial capability of youth as a part of the Advancing Integrated Microfinance for Youth (AIM Youth) initiative. The initiative was launched with the objective of reaching 37,000 youth between the age of 13 to 24 in Mali and Ecuador with financial services and financial education. The study assesses two mobile-based technologies that were used in Ecuador: text messages to reinforce financial education concepts and remote savings collections through smartphones. It finds that the implemented technologies are being positively received by youth, parents, and staff and both innovations are also prompting youth to save money. Other key findings include:
- Convenience and perceived level of security of the remote savings system has a positive influence on youth savings;
- Financial analysis for the text messaging suggests that the revenues from youth savings alone are insufficient to cover initial or ongoing expenses of using the technology;
- There is a possibility that the remote savings mobilization could have a substitution effect, in which youth make a deposit remotely instead of at a branch, and thus not result in an additional deposit.