M-Pesa Mobile Money and Poverty Reduction
MIT / IGC / Safaricom · Kenya · 2016
Summary
The M-Pesa study used geographic variation in agent rollout as an instrument for mobile money access, finding meaningful consumption gains — particularly for female-headed households, who benefited most from the ability to receive remittances and save securely. The 22% consumption gain for female-headed households was the standout finding, suggesting that financial inclusion through mobile money closes a gendered access gap. The study is methodologically influential as a model for evaluating fintech using natural variation in infrastructure rollout.
Research question
"Does access to mobile money services reduce poverty and increase household resilience to shocks?"
Methodology
Intervention
M-Pesa mobile money service rollout; geographic variation in agent availability used as instrument for access
Assignment
Instrumental variable using geographic rollout of M-Pesa agents as exogenous variation
Sample size
1,593 households tracked over 4 years; national M-Pesa transaction data
Primary outcome
Consumption per capita; financial resilience to income shocks; poverty exit
Effect estimate
M-Pesa access increased per capita consumption 2%; 2% of households lifted from extreme poverty; female-headed households: +22% consumption
Decision
M-Pesa expanded to 10 countries; results used to support mobile money regulatory frameworks globally
Result
Positive
M-Pesa access increased per capita consumption 2%; 2% of households lifted from extreme poverty; female-headed households: +22% consumption
Evidence strength
Moderate
Quasi-experimental design; causal interpretation requires care.
Replication status
Partially replicated
Institution
MIT / IGC / Safaricom
Location
Kenya
Year
2016
Policy area
Financial Services
Mechanism
Information