Radio Campaign Demo

Everyone has a roll to play to improve financial consumer protection, including clients. This report covers lessons learned from three CFI initiatives to raise consumer awareness in Ghana, Benin, and Uganda.

Why Consumer Rights?

The Client Protection Principles create a common framework for financial services providers (FSPs), policymakers, and clients to better understand and discuss consumer protection issues. While much of the financial inclusion industry’s work has focused on providers and regulators, there is a third, crucial constituency: the clients.

Often, efforts to involve clients in this conversation are often limited because consumers lack awareness of their rights and responsibilities when accessing financial services. In order to address this gap, the Smart Campaign led a multi-country initiative spanning three years to experiment with client engagement techniques, ranging from radio campaigns, social media, and journalist competitions.

This report will cover the Smart Campaign’s initiatives in Ghana, Uganda, and Benin. We will discuss country-specific consumer protection issues as well as the engagement approach for each campaign. Lastly, we will share the lessons learned across these markets and different approaches.

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Our Approach

The rapid growth of digital financial services has introduced new opportunities and accompanied risks for first-time consumers of financial services. Many markets lack the guardrails to address these new risks, increasing the urgency to improve consumer protection practices at the provider level and to increase client awareness of their rights and responsibility. Against this backdrop, CFI conceived the protection radio campaigns to help mitigate risks and empower customers by means of educational programming.

The objective of this initiative was to experiment with different techniques to educate and empower clients. In many countries in sub-Saharan Africa, radio remains one of the most important widespread communications mediums, especially as internet and mobile connectivity has grown inconsistently or remains too costly. Ghana and Benin have one of the highest percentages of household radio ownership with 72 percent. In Uganda, household radio ownership is at 61 percent. Reported daily use in Africa of various media channels bears these stats out: 46 percent of Africans report accessing daily news through radio, 37 percent through television, while only 9 percent read newspapers. In contrast, mobile internet connectivity is only 24 percent in sub-Saharan Africa. Internet and mobile penetration are growing quickly in a few African countries, especially for urban citizens. In Ghana, mobile internet penetration is estimated to be 45 percent.

This context of shifting media landscapes, both across and within countries, encouraged us to use this initiative to explore different communications channels including radio, social media, and traditional media to reach the target audiences. In addition to exploring different communications channels, we also experimented with storytelling techniques, from radio interviews to dramas and animated shorts. For each country, we took a four-part approach to determine the appropriate components and strategy for raising financial consumer protection awareness based on market dynamics.

Ghana

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Over the years, Ghana has been home to political stability and increased economic growth. But despite this favorable environment, 24% of Ghanaians still live in poverty. On the one hand, Ghana’s financial inclusion sector has grown in its offerings of diverse products serving an increasingly wide range of clients. Regulators and ministries in Ghana have also put consumer protection at the forefront, through reformed frameworks on complaints and disclosure, emphasizing the importance of stronger client protection principles. On the other hand, Ghana’s microfinance sector underwent a tumultuous period, with the onset of collapsing institutions, Ponzi-schemes, loss of depositor’s money and the bank of Ghana revoking licenses from several institutions.

Against this backdrop, the aim of the Ghana radio campaign was to educate financial service consumers on their rights and responsibilities while also reinforcing the Bank of Ghana’s initiatives and policies on consumer protection.

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41%

the increase in access to formal financial services since 2010

36%

Number of Ghanaians with access to formal financial services

4 Million

the number of active users of digital financial services in Ghana in 2015, up from 150,000 active users in 2011

Stat explanation

Ghana’s Consumer Protection Landscape

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Microfinance lenders and digital financial service providers in Ghana identified fraud as a top consumer protection issue. Research conducted by the ITU found that 56 percent of mobile money users in Ghana have received a fraudulent or scam SMS, while 12 percent of mobile money users have lost money to a fraud or a scam. As mobile money users continue to grow, curbing fraud is a priority of the Bank of Ghana to ensure confidence in the sector.

Despite the Bank of Ghana Act’s that mandate the safety of depositors’ funds, a crisis managed to brew which threatened the microfinance sector with the insolvency of the financial institutions and the disappearance of clients deposited funds. A few microfinance institutions that recently went under include US Tilapia Company, Safeway Tilapia Company, DKM Microfinance, God is Love Microfinance among many others. To-date, some clients of those organizations have not been fully compensated for their losses. Customers should be empowered to better uncover which organizations are potentially fraudulent, who to report fraud to and what recourse they have if they lose their money in a fraudulent scheme.

Research indicate that even literate clients did not always understand pricing information, and high interest rates as serious concern for clients.  The Bank of Ghana recently released guidelines for transparency, “Disclosure & Product Transparency Rules for Credit Products and Services,” which details what financial service providers must do and what clients can expect from providers,1  building on the Borrowers and Lenders Act of 2008. These measures provide policy guidelines, yet… [why are they insufficient? Why do we need to do more on transparency?]

Recourse systems are limited in Ghana. When such systems do exist, clients are rarely familiar with them. The Bank of Ghana recently released the “Consumer Recourse Mechanism Guidelines for Financial Service Providers,” which details what financial service providers must to do comply with regulation. For DFS customers, reaching out to the complaints system is common: research commissioned by the ITU showed that 39 per cent of Ghanaian DFS users have called a DFS customer care line

Ghana Radio Campaign

To inform the design of the radio campaign, a National Advisory Council was assembled. This consisted of representatives from the Bank of Ghana, GHAMFIN, the Consumer Partnership, the Ministry of Finance, and CGAP, as well as financial technology companies including Dream Oval and Inclusive Financial Technologies. Through desk research, key industry insights and findings, the campaign sought to target microfinance users and leverage communication channels that provided the widest coverage to both urban and rural areas. With the majority of Ghana’s population being Twi and English speakers, the campaign was broadcasted in these languages. The 2 dominant radio stations, were selected based on their listernship – Adom for twi listeners and Citi for enlsigh.

You Deserve to Know

Ghana's Radio Campaign Animated Series

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Benin

Why Benin, what did we do? 

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32%

the number of adults (age 15+) that have a formal account. A quarter 

1/4

the portion of Beninois adults that have used formal financial services, but only a fifth report owning a registered formal financial account in their name.

47%

number of Beninois adults that report having saved in some manner, with 20 percent reporting that they have borrowed.

Benin’s Consumer Protection Landscape

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In the past, Benin saw a significant increase in unlicensed MFIs that greatly outnumbered authorized ones. Because legitimate MFIs take savings before granting clients loans, some defrauders see an opportunity to collect deposits and promise loans in the future, only to disappear with clients’ money or retain client’s savings illegitimately. Ensuing problems such as fraudulent or ‘disappearing’ financial institutions, collections that involved the police and inadequate understanding of compulsory savings became rampant in the market. 

Transparency emerged as one of the Client Protection Principles that resonated most as a priority for client protection in Benin.  The Client Voice research from 2014 revealed that lack of transparency about savings deposits versus fees caused confusion about savings balances for a majority of respondents.  The research also also found that the lack of transparency in pricing and disclosure of fees was a problem among some MFIs in Benin.

According to the Client Voice report conducted in Benin in 2015, recourse processes were not working well from the clients’ perspective, and clients did not know where to complain. Eighty-six percent of clients reported that their MFI did not inform them of where they could complain if they had a problem with its services. Obstacles that clients currently face using recourse mechanisms are fear of being denied service, a weak culture of complaining, lack of trust in addressing complaints, and fear of retribution after complaining about an employee.  

In 2016, Alafia introduced a nationwide recourse mechanism in order to fill in the gap in options available to clients to voice their grievances with their service providers, particularly small and medium MFIs. The mechanism was designed to receive all complaints from microfinance clients and is structured into two levels: 1) the client directs their complaints to the designated person at the MFI; 2) serious issues or unresolved issues are directly addressed by the association.  

Many financial institutions reported that irresponsible borrowing behavior from customers was a major issue due to a lack financial educationThe Client Voice report revealed that 66 percent of clients did not know how much they would pay for their loan in total and only 12 percent of clients knew the interest rate on their loan. The other contributing part could be contributed to “ill-intentioned” individuals trying to take advantage of any single opportunity that the environment offers, sometimes at the expense of serious risks and harms to themselves and partner institutions.

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Uganda

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46%

number of adults that were financially included in 2017, mainly via mobile money (43%), followed by banks (11%) and non-bank financial institutions (NBFIs) (7%).

8%

the growth in the number of adults who accessed financial services increased by 8 percentage points, from 55% in 2016 to 63% in 2017. The growth in access was due to the substantial increase in the proportion of the population that used mobile money, now, at 61%.

95$

the number of financially included adults that had a mobile money account in 2017.

8%

the increase in the proportion of adults who accessed formal financial services from 2016 to 2017, the largest annual increase ever recorded by the FII surveys in Uganda. 

Partners

We appreciate the support of our partners.

(standard lingo - acknowledge MCF as partner and XYZ global as partner. ) The Africa Radio Campaign is a joint project between the Smart Campaign, Financial Inclusion Forum Africa and........ , with support from Mastercard Foundation.

Mastercard Foundation

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XYZ Global

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