How Silicon Valley’s Mobile Money Apps are exploiting the world’s poorest

Not everyone in low-income countries is a low-income person’s, but a majority in these countries barely make a dollar a day. Yet they are targeted as customers and consequently exploited by AI geniuses who are world’s apart and then boast over a cup of coffee how they are helping the world’s poorest in their pitch to the next investor. For a fact they are ripping off the poor to buy a new yacht. May be it’s time to visit the places you make money from and feel the real impact on the ground.

I read somewhere about purpose driven companies where you make money to solve real world problems, and not create problems to make money. It’s a business model that some companies in Germany have adopted, among them a leading search engine. Coincidentally, Silicon Valley is not in Germany and has an opposite approach to business. You can tell with the lifestyle of big tech founders, who barely pay taxes, but make the measly pledge to donate all their wealth when they die. There is a lack of desire to adopt purpose driven companies in the here and now.

This brings me to an ordeal I have experienced in the last three days. I am sipping my morning tea but I can’t enjoy it because of the amount of anxiety that has already filled my belly. I haven’t slept well either in the last two days anticipating this day would come. My phone is on silent mode since I expect a barrage of calls and sms from loan sharks for a seven day loan. Thirty dollars plus 30 percent interest. For every three dollars, you must pay extra dollar in interest, and a tenth a day for late payment penalties. I expect by the third day to pay at least 43 dollars for this loan. The extra thirteen dollars will wipe out a meaningful part of my savings or emergency cash for the month. Remember I borrowed this money for an emergency not to throw my monthly budget into disarray. Did I say monthly, yes, because we are paid on a monthly basis not a weekly or biweekly basis. So begs the question, who made these apps and for whom?

Silicon Valley made these apps, in an attempt to increase access to lending to the ‘unbankable’ so they say. Then followed their Chinese copycats who are more vicious like their government, with the sole purpose of extracting more than they give to borrowers to make it a worthy investment. Digital privacy is obviously a dirty word for these apps because they impound your contacts and messages to monitor your cash flow, and yes call everybody on your phonebook when you don’t pay on time. Those who borrow have smart phones and mostly the young digitally literate. Their sources of income are very unpredictable since majority are lowly paid and not salaried given the high levels of unemployment in low income countries.

Here is an example that would be an emergency that would lead you into this money trap as a young person. You have a girlfriend who wants to go out and here men always pay the bill and give gifts. You don’t have enough to pay so you swap from your phone for some 'emergency' cash to make love and joy happen. You part ways and over your head hangs the seven day deadline to pay back. This comes with a reminder two days prior to the deadline to pay as fast as you can to increase your credit limit, translating to more debt. Before your next date, you are contemplating calling it off, or putting in more investment, but you can’t give up so easily. So you pay off quickly and take another bigger loan, before you know it, by the fourth date, you are deep in debt, very stressed and unhappy, and may be things didn’t work out. Meanwhile, Silicon Valley and Chinese money sharks, have already had a return to investment, and now want to go bigger because of their success. What’s not being said is that these people leave their customers poorer than they found them. It’s better to be poor and loan free, rather than poor because you took out a loan.

Am saying all this to advice Silicon Valley mobile lenders that they should review their lending policy to get more customers if not make the Chinese lenders look really bad. Someone is losing sleep on the other side of the world because of your inconsiderate greed. Greed is never considerate. Think through your business model and whether or not it meets needy people’s needs. Weekly loans are a gluttony fest. Consider that unlike Americans, we are paid monthly. We are not asking for humanitarian aid here, rather a fair business relationship. We might be the small fish in the sea, but eat us humanely. Don’t take away our pasture that we barely have savings for our children. Don’t buy a silver yacht at the back of poor people’s misery and tears. The harassment by these heartless money sharks made me feel poor, but I knew that those on the other side of the call are my fellow country men who are being exploited by these international companies with long working hours. I felt the stress many people go through on a daily basis when forced to meet unrealistic loan repayment schedules. It’s not fair and we cannot continue without universal digital privacy laws regulating these apps from either side. Attitudes must change when lending to the poor especially if bad actors like China want to keep entire nations in debt, either in national or private debt. Silicon Valley must step up it’s influence, invest more in digital lending but do it ethically. I will not lose another day of sleep because I owe someone unknown to me, but I will consider a loan with fairer terms of repayment for my peace of mind. We might as well do better business purposely to lift people out of poverty, or just close shop if we seek to exploit them. No one will die because they didn’t access a loan, but they might if a lender sinks them into depression. Silicon Valley has bigger prospects if it adopts purpose over profits, China’s greedy digital lenders are bound to fail when Silicon Valley becomes the better option.


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