Th The potentia ial l of dig igit ital l pla latforms as s dis istrib ibutors of f fin financia ial l se servi vices in in Rwanda, with ith a a deep deep di dive e in into the the fina financia ial l nee needs of of Yeg ego e-ha haili iling driv drivers Kigali | February 2020
ent Dig igit ital l pla latforms as new economic ic actors sh shapin ing li liveli lihoods Onl Onlin ine sho hoppin ing E-hailin iling Connects consumers and Connects passengers suppliers of products and local drivers Rental Ren Freela Fre lancin ing Facilitates exchange of Connects employers and spare rental capacity freelance workers and demand Log Logistics/courier Connects customers Oth Other to service providers Does not fit into for delivery or any other category distribution of parcels
ent Africa’s digital platforms 300 277 277 250 • 277 277 unique platforms • 4.8 4.8m platform workers 200 Number of platforms 150 2018 92 92 90 90 100 69 69 68 68 43 43 41 41 39 39 50 32 32 0 Total Ghana Kenya Nigeria Rwanda South Africa Tanzania Uganda Zambia Source: insight2impact (2018)
ent E-hail ilin ing a promin inent pla latform type in in SS SSA Online shopping 91 91 Freelancing 75 75 E-hailing 53 53 Logistics/ Courier Rental 37 37 27 27 Other 26 26 Source: insight2impact (2018)
ent Pla latforms offeri ring addit itio ional l fin inancia ial l se servi vices 15% 15% of platforms identified offer one or more 20 20 20 20 insurance, digital wallet, savings or credit product. 6 1 Savings Credit Digital wallet Insurance Source: insight2impact (2018)
ent Cle lear in incentiv ives for r FSP SPs and pla latforms to partner Ince Incentiv ives Pla Platf tform for or FSP SPs inc ncenti tives • Established customer • Diversification of base and data revenue stream • Integrated payments • Increase • Established participation on communications channel the platform • Trusted brand • Expand their • Frequent use consumer base • Decision proximity
r ion 1 y) E-hail ilin ing case study: Yego in in Rwanda
ent Overvie iew of f Yego Part rticip ipants • Digital platform that connects cab and motorbike drivers to passengers • Around 17,000 moto and 1,300 cab drivers in Kigali Acti ctivity • Matching of drivers and customers through call centre or mobile app • 1 million+ trips completed Valu lue proposit ition • Use of smartphone meter to get distance, fare and number of trip information • Cash and digital forms of payments accepted • Government mandated use of meters by cab drivers already and moto drivers by May 2020
Access ss to fin financia ial l se servi vices in in Rwanda 72% % of adults in Rwanda borrowed money (Finscope, 2016 ) Credit access strand 2016 4% 4% 11% 11% 51% 51% 6% 6% 28% 28% Bank Other formal (non-bank) Informal only Borrow from family and friends Not borrowing Savings access strand 86% % of adults in Rwanda saved money (Finscope, 2016 13% 13% 36% 27% 10% 10% 14% 14% 2016) Bank Other formal (non-bank) Informal only Save at home Not saving Insurance strand 1 4% 4% 73% 19 19% Mutuelle de Santé and other insurance product Insurance other than Mutuelle de Santé Source: Finscope 2016
ent Meth thodolo logy • 86 86 moto drivers with meters out of 289 289 responded to survey • 223 223 cab drivers with Pha Phase 1 meters out of 993 993 Phase 2 Pha 2 responded In-depth qualitative Quantitative survey interviews with 15 15 design, testing, moto drivers and 5 refinement and cab drivers rollout Phase 4 Pha 4 Pha Phase 3 Partnership and Analysis and product development synthesis of findings Phase 4 is not yet covered
r ion 1 y) E-hail ilin ing case study: e-hailing pla latforms and fin inancial services glo lobally
ent La Large glo lobal l e-hail ilin ing mark rket 248 total platforms investigated globally, operating in 110 countries worldwide and 14 14 countries in Africa 24 24 platforms 223 cab-only ly 1 1 mot offering bot both cab otorbike onl only hailing platforms and motorbike hailing platform hailing Source: insight2impact (2019)
E-hail ilin ing rid ride cycle le Gap in driver Drivers covered by coverage Drivers covered by rideshare policies personal insurance policies Of Off-trip ip On-trip On ip Gap Gap App off App on Accept trip Collect passenger Passenger drop-off Source: insight2impact (2019)
Some glo global e-hailing pla latforms are alr lready offering fin financial se services 25% of e-hailing platforms globally offered at least one type of financial service. 25% Insurance products offered by platforms Personal accident 40 Loss of income insurance 30 Liability coverage 10 • 22% offered an insurance Comprehensive insurance 6 product Collision coverage 3 • 5% offered a credit product • 2% offered a savings product UM/UIM 2 SASRIA 1 Child support 1 Excess insurance 1 Source: insight2impact (2019)
Some examples of f fin financial products ts offered by e-hailing pla latf tforms Illustrative partnership case studies identified Source: insight2impact (2019)
r ion 1 y) E-hail ilin ing case study: Yego consumer in insights
ent Yego driv rivers Good service, transparency and ease of payment as reasons for joining Yego “ The advantage with Yego is that with this new technology it’s really an innovation and some customers who now are accustomed saying that it’s better to use the meter, it’s profitable for us.” – Moto driver, 39 “I get to know the actual price of the distance we used and be able to show it to my client without them thinking I’m “I chose Yego because they offer lying. It’s also a system that better services such as giving us makes it easy for passengers to the tools we need for work and pay faster and efficiently.” paying for them in instalment if need be.” – Moto driver, 35 – Moto driver, 39
ent Yego driv rivers Participants married, youthful population with a large number of dependents 100% % of both cab and moto drivers are male; ; 9% % of moto drivers are youth (35 years or younger) compared to 36% % of cab drivers. 58% % of moto drivers and 61% % of cab drivers are married. 65% % of moto drivers and 68% % of cab drivers have between three and six people that rely on their income. 24% % of moto drivers and 39% % of cab drivers have spouses or partners that earn an income.
Addit itio ional l so sources of f inc income Drivers depend heavily on Yego as primary income source “ I ha o. ” 21% Moto drivers have wor ork ou outsi tside Yeg ego. 17% Cab drivers Note: n= 86 for moto drivers and 221 for cab drivers (2 cab drivers did not answer this question). % of respondents who have work outside of Yego 50% 48% 28% 18% 18% 17% 15% 6% 3% 0% I provide a service, like a My own business (I sell Driving own vehicle or My own business (I sell Rental income mechanic, plumber or farm products, like other vehicles other products like computer repairer vegetables or goats) clothes or shoes) Note: multiple response question. n= 18 for moto drivers and 38 for cab drivers
Vehic icle le ownership ip status among Yego driv rivers High vehicle ownership , particularly by young moto drivers Vehic icle ownership ip 71% of the youth population 71 70% own their moto outright, while 46 46% of the youth own their cab outright. Moto drivers 51% % of respondents Cab drivers 30% 23% 19% 7% I own the vehicle I am still paying off what I owe I do not own the vehicle Note: n= 86 for moto drivers and 223 for cab drivers
So Source of f fu funds for r vehic icle le purchases Credit from banks and savings used to purchase vehicles 70% I own the vehic icle le “ I own le. ” 51% wn or or am am sti till l pa payin ing of off f my vehic icle 23% I am stil il pa paying of off f what I owe 19% Moto drivers Cab drivers % of respondents that own or are still paying off their vehicle 42% 32% 31% 19% 19% 11% 11% 9% 8% 6% 6% 4% 2% 1% Savings Bank Other Family or friends SACCO MFI Money-lender Note: multiple response question. n= 80 for moto drivers and 156 for cab drivers
Fin inancia ial l goals ls of f Yego driv rivers Financial goals centering on asset ownership Top op two fina financial l goal oals s over ne next xt two o years Moto drivers 30% Cab drivers 28% 28% 23% 21% % of respondents 18% 11% 11% 11% 9% 6% 4% Buy or build a home Buy a motorbike or car Pay for a good Have enough money Start a business Have enough money education for my for old age for a big life event children Note: multiple response question. n= 86 for moto drivers and 223 for cab drivers
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