Teleuse by the Bangladeshi migrant worker

1. Teleuse by the Bangladeshi migrant worker This work was carried out with the aid of a grant from the International Development Research Centre, Canada and the Department for International Development, UK, with contributions from Telenor Research & Development Centre Sdn. Bhd., Malaysia. Photo credits: CKS Consulting Pvt. Ltd.

2. Teleuse@BOP background • Objective: To understand how Bottom of the Pyramid interacts with ICTs (mostly phones) to better inform policy • Large surveys of ‘BOP’ conducted in 2005, 2006, 2008 • Almost 20,000 face to face interviews in 6 countries since 2005 • Bangladesh (2008) • Pakistan • India • Sri Lanka • Philippines • Thailand • Funded by the International Development Research Center (IDRC) of Canada, the Department for International Development (DFID), UK with contributions from Telenor Research and Innovation, Malaysia 2

3. Method 3 • Multi-stage stratified sampling, random selection of households and individuals • Field research conducted by Nielsen; 12 languages; 6 countries • Migrant worker teleusers at “bottom of the pyramid” • SEC groups C* + D + E • Overseas and domestic migrants that send money home

4. Samples [1] Pakistan: Excludes tribal regions [2] Sri Lanka: Excludes North and East [3] Philippines: Survey was undertaken only among SEC E [4] Thailand: Excludes Bangkok as the SEC DE population in Bangkok is very small 4

5. Sampling logic • Multi-staged stratified sampling by probability proportionate to size • Regions (states/provinces/districts) randomly selected in 2006; kept the same for comparison in 2008 (except BD) • Stratification of cities within state, province etc • Geographical ordering of cities, villages • PPS selection of cities, villages • Within PSU • Random starting points • 10 HH per starting point; right hand rule • KISH grid to select respondent in HH

6. WHO ARE THE BOP? BOP TELECOM EXPANSION ACCESS OWNERSHIP MARKET POTENTIAL WHAT THOSE AT BOP DO WITH THEIR MOBILES? POTENTIAL FOR MOBILE 2.0? BENEFITS? THE UNCONNECTED… Agenda 6 back

7. WHO ARE THE BOP? BOP TELECOM EXPANSION ACCESS OWNERSHIP MARKET POTENTIAL WHAT THOSE AT BOP DO WITH THEIR MOBILES? POTENTIAL FOR MOBILE 2.0? BENEFITS? THE UNCONNECTED… Agenda 7 back

8. Teleusers at “bottom of the pyramid” SEC groups D + E Aged 15-60 The study represents approx. 62 million in Bangladesh (Rural India: R2, R3, R4) 8 Among BOP teleusers

9. Link between SEC D+E and "$2 per day" definition Actual population proportions 9

10. Households earning ~USD71-143 per month (on average) 10 Among BOP teleusers

11. 80% of these non-owners can reach a phone in under 5 minutes Urban: 89% can reach a phone in under 5 mins Rural: 78% can reach a phone in under 5 mins 54% of Bangladeshi BOP households don't own a phone 54% BOP = 57% of BOP teleusers Among all BOP teleusers

12. Main reasons for not owning are affordability and the lack of a need Among BOP non-owner teleusers

13. Bangladeshi BOP can afford USD23 to get connected, but think that it will actually cost them USD38 Among BOP non-owner teleusers

14. Once connected they can afford to spend USD1.80 per month on communication costs, while they think it will actually cost them USD2.50 14 Among BOP non-owner teleusers

15. 31% of the current unconnected BOP in Bangladesh plan to get connected; 98% through a mobile Among BOP non-owner teleusers planning to get connected

16. Background to migrant study component being released for first time in Dhaka today

17. Quantitative • 1,500+ face-to-face interviews • Oct-Nov 2008 • Qualitative • Depth interviews through home visits with migrant workers and/or families in location of origin • Feb-Mar 2009 Method • SEC groups C* + D + E, aged between 15 – 60 • Migrant worker & migrant worker families (qualitative) interviewed. • “domestic” and “overseas” migrants • Domestic: Living and working away from home (within the same country) • Overseas: Returned (temporarily or permanently) from working in a foreign country • Had used a phone in the last three months • Had sent money to family in the last thee months • A small sample of SEC C users was taken in Pakistan

18. Quantitative sample [1] Pakistan: Excludes tribal regions; includes SEC C [2] Sri Lanka: Excludes North and East [3] Thailand: Excludes Bangkok as the SEC DE population in Bangkok is very small 18

19. Qualitative sample With migrant workers & migrant worker families

20. Outline > Migrant worker sample characteristics > Communicating home > Sending money home > Mobile remittances? 21

21. Migrant worker characteristics

22. Mostly SEC D and E, some C in PK • Migrant workers (domestic or overseas) from “bottom of the pyramid” who remit money to family • SEC groups D + E mainly, some C in PK • Aged 15-60

23. Mostly males in BD, PK & IN; males + females in LK, PH and THMore educated migrants from PK* and PH* includes SEC C migrants

24. Migrants earning USD 417 (overseas) & USD 124 (domestic) per month on average Monthly personal income (USD) * Many refused to answer Ownership of bank account or credit card (% of BOP migrants surveyed)

25. Majority of overseas migrants work in Middle East; Southeast Asia also popular among SeA migrants

26. Bangladesh destination countries

27. Communicating home

28. 28% Bangladeshi overseas migrants make Internet calls; 8% Internet chat (everyone, except a few Filipinos, uses the phone!) Overseas migrants Domestic migrants

29. Own phones (mostly mobile) used most as primary phone, followed by public phones; primary use to keep in touch with loved ones at home, and for work (depending on job) Overseas migrants Domestic migrants

30. Simi | Farmer / housewife / mother of domestic migrant Jae Hom, Thailand (rural) • Migration almost always results in mobile adoption, either the migrant purchases the handset and gives it to her family, or she passes down her handset and buys a new one for herself. • Simi’s son is a domestic migrant. She has a mobile primarily to keep in touch her son who works outside of the city. After he migrated, the need to be in constant touch with her son arose. • Before owning a mobile, communicating with her son involved lots of time, effort and constant mediation by others. • To call she had to travel (a considerable distance) by bike with her husband to a public phone, where she would often have to spend time waiting in line. • To receive a call from him, she would have to go by bike with her cousin to the cousin’s house where she could receive the call. • After two years her son bought her a mobile phone.

31. Bangladeshi and Pakistani overseas migrants call home most frequently: 87% in BD call home at least once a week; 34% dailyBased on respondent recall Overseas migrants At least once a week Daily • The primary need for communication was to keep in touch with loved ones at home. Depending on the type of job (e.g., client-driven, delivery-based, etc.) some need to communicate with local contacts. • Often, the communication needs of overseas migrants are limited to communication with family and friends at home, rather than contacts within their destination country. However once they return home for holidays, the need to stay in touch with supervisors/bosses/colleagues in increases, in order to ensure they have a job (or the same position) to return to.

32. Domestic migrants call more frequently than overseas migrants; again highest in BDBased on respondent recall Domestic migrants At least once a week Daily Source: LIRNEasia (2008, October). Mobile Price Benchmarks * Refers to local charges only; national per-minute tariff is 0.034

33. SMS popular among PK and PH overseas migrants, and PK, LK and PH domestic migrants Overseas migrants Domestic migrants Source: LIRNEasia (2008, October), Mobile Price Benchmarks. * Refers to local charges only; national per-minute tariff is 0.034

34. Bangladeshi overseas migrants spend most: USD48 per month on average; thrice that in IN/PH; most overseas B’deshis spend USD 40-50/month, most others spend USD10-20 Overseas migrants Bangladesh Mean: USD 48 Most spend USD 40-50 Pakistan Mean: USD 36 Most spend USD 10-20 India Mean: USD 15 Most spend USD10-20

35. Mean monthly expenditure on communicating home (cont'd) Overseas migrants Sri Lanka Mean: USD 38 Most spend USD10-20 Philippines Mean: USD 16 Most spend USD10-20

36. Domestic migrants Domestic migrants India Mean: USD 3.34 Most spend less than USD 6.67 Bangladesh Mean: USD 7.08 Most spend less than USD 5 Pakistan Mean: USD 8.52 Most spend less than USD 5

37. Domestic migrants Sri Lanka Mean: USD 8.60 Most spend less than USD 6.67 Philippines Mean: USD 4.40 Most spend USD1.25-2.50 Thailand Mean: USD 9.68 Most spend USD5-10

38. Cost of calling home from 4* of top 5 destination countries: Off-peak* International calling rates from Kuwait not available USD1.20 • Per minute cost of calling home using largest mobile operator (except UAE: second largest) To USD1.17 USD0.58 Calling from

39. Cost of calling home from 4* of top 5 destination countries: Peak* International calling rates from Kuwait not available USD1.34 USD1.24 • Per minute cost of calling home using largest mobile operator (except UAE: second largest) To USD0.65 Calling from

40. Bangladeshi overseas migrants make longer calls Based on respondent recall Longer calls, more often  higher costs

41. Sending money home

42. Lourdes | Grandmother 57 | Metro Manila, Philippines

43. USD 9b overseas remittances to Bangladesh in 2008 (AFP, http://www.google.com/hostednews/afp/article/ALeqM5jyBqlJab_jioB-w9Mnn1lhf55lIQ ) • Nearly 10% of GDP; significant contributor to foreign reserves • May 2009 saw record of USD 890m in remittances • Official estimates: 6.3m overseas migrants (unofficial: 9m)

44. Bangladeshi overseas migrants remit USD203 per month on average (highest in S Asia); domestic remit USD27

45. Most BD overseas migrants send money home every 1-2 months; less frequently than in PK Overseas migrants

46. Overseas migrants mostly send money through banks or in cash (low cost option) Sending money through banks is seen to be cheap and reliable; often migrants open bank accounts for their family in order to receive money. Drawbacks are that a visit to the bank is necessary (though some migrants befriend bank workers –often countrymen– who facilitate transfers without the migrant needing to visit), and banking facilities should be easily accessible to the migrant’s family too Overseas migrants Though many in the Philippines use money transfer services (e.g. Western Union), it is seen to be more expensive, therefore used as a second option, to bank transfers Hundi can be costly, but is capable of doorstep delivery in rural areas; additionally, loans can also be taken from the vendor (at high interest rates); it is seen to be reliable in IN and PK, but not BD and LK

47. Domestic migrants mostly remit once a month (when they go home) Domestic migrants

48. Domestic migrants send/take money in cash; "mobile payments" used by 6 % in BD and 2 % in PH Domestic migrants Sending money with friends and relatives is free and reliable and thus popular; it is often reciprocal; includes sending money through (known) bus or ferry drivers Remittances are also delivered through bus drivers in India and Philippines, and ferry drivers in Bangladesh; often the driver is an acquaintance, so no charge is levied and he knows who exactly to deliver the money to Post office money transfers, are extremely popular among domestic migrants in India due to the low cost, doorstep delivery, perceived extensive coverage of the postal network, but also the reliability, since it is operated by the government

49. Most who remit via banks are satisfied, though complaining of cost in LK and PH Transfer charges? Bank wire transfers were seen as more expensive and thus resorted to only emergency situations since transfer takes only minutes

50. Bank and wire transfers were among those most popularly used, and was seen as one of the cheaper and convenient options • E.g., In Dubai, the worker need not have a bank account. The Etisalat Bank provides workers with a bank ID using which they can send money to any account of their choice and the nominal service fee is paid by them in cash. Service charge amounts to 2.5% of the total amount sent or AED 100 (USD 27.2) for transactions less than AED 5,000 (USD 1,360).