Mobile Money for Member Dues: Can technology transform worker organizations?

In this article, our Organization and Representation Programme Director, Jane Barrett, tells us about an innovative mobile money dues collection initiative. It was launched by the Amalgamated Transport and General Workers Union of Uganda (ATGWU) and has revolutionized an antiquated administrative system. She spoke with John Mark Mwanika, ATGWU’s project coordinator, for this piece.

The ubiquitous motorcycle taxis buzzing across Kampala, Uganda’s capital city, shuttle commuters and shoppers around the growing African metropolis. The drivers of these moto-taxis, known as boda-bodas, are busy, working long hours to pick up enough passengers to make ends meet for the day. These time constraints and the irregularity of their earnings often have repercussions for their representative organizations, which rely on regular dues from members. 

So the Amalgamated Transport and General Workers Union of Uganda (ATGWU), of which moto-taxi drivers are a part, got an idea: collect monthly dues using a mobile money app to ensure regular payments. 

The innovative model, launched in January 2018, revolutionized the age-old pencil and paper system into a modern dues-collection platform that now has a steady stream of member subscribers – critical to the sustainability and independence of any worker organization. How ATGWU did this and what it has done for the union is a fascinating lesson in how worker organizations can adopt new technologies to improve their viability and expand their activities.

Boda-boda drivers wait for customers in Kampala, Uganda. Photo: J. Barrett

New Year, New Innovations

The ATGWU set its sights on the New Year to introduce its new dues-collection app. As soon as crowds of revelers had cleared the streets after ringing in 2018, ATGWU got to work familiarizing its affiliate organization with this new technology. 

The ATGWU acts as an umbrella organization for the various associations of informal transport workers in the country. The associations use member dues to pay a fee per member to the union.

Among ATGWU’s affiliates is the Kampala Metropolitan Boda-Boda Entrepreneurs (KAMBE), which has nearly 50,000 members – an unwieldy number when trying to track down late or missed dues. 

Until the beginning of 2018, KAMBE’s member fees were paid in cash, and the administration of membership was done entirely manually. The administrative burden was heavy, and yet neither KAMBE nor its mother body, ATGWU, could rely on a predictable and reliable income from dues. 

This unpredictability was affecting the level of service that KAMBE and ATGWU could afford to provide to members. KAMBE was also finding its manual records unreliable for accurate accounts of its membership at any one time. 

Something needed to change.

That’s when ATGWU stepped in and introduced KAMBE to Airtel, a mobile money provider, and then encouraged KAMBE to negotiate a deal for the collection of monthly subscriptions. This approach is in keeping with ATGWU's commitment to building the self-sufficiency of its affiliated associations. 

The system is now up and running, with members paying their dues on a flexible basis, as and when they have ready cash available. Members are able to choose whether to pay in a number of installments in a month, or even to pay in advance. 

Airtel transfers the received money to KAMBE and provides a monthly consolidated payment record, broken down into the lowest level of organization. In this way, local leaders are able to keep track of their local membership and to find out directly from members why they might have fallen into arrears. Divisional offices use the monthly reports to build databases of members.

Mobile Money’s growing presence

Mobile Money is a fast-growing mobile phone-based system of storing, sending and receiving money without the formality of a bank account. It can be used on both smartphones and basic feature phones, making it useful for informal workers. Mobile money is being hailed by many as a tool for financial inclusion as it allows previously unbanked individuals to transact safely. The vast majority of users of mobile money systems use the platform only for "cash in and cash out" payments. Users buy credit from a readily available outlet (usually an informal trader who is also selling air time), load it onto their mobile-based account, and then redirect payments to creditors. 

Mobile money platforms are growing particularly fast in countries where the service providers are not regulated as fully fledged banks. Worldwide there are reported to be over 130 million mobile money users, with the majority of users concentrated in Africa and South Asia, but with a growing number in Latin America. (See the end of this article for a full list.)

With the regular dues, the real work gets started

While the mobile money system has transformed KAMBE/ATGWU’s subscriptions income and management, the real turning point for them came in their ability to service their boda-boda members in providing collective bargaining. 

“Collective bargaining training is the very first level of empowerment of workers – even before basic trade union education,” says John Mark Mwanika, ATGWU’s project coordinator.

In addition to day-to-day representation of boda-boda workers, KAMBE has linked up with the Centenary Rural Development Bank, a microfinance commercial bank, for various services, including securing land for building low-cost houses for KAMBE members, as well as securing loans to fund the purchase of motorcycles. Two-thousand KAMBE members have already accessed loans to purchase their own vehicle. 

“This is all part of improving working conditions and pursuing decent work,” says Mwanika. “If a driver owns his own vehicle there is no longer the pressure to break all the road rules and work excessive hours in order to meet the owner’s targets. By the end of 2019, we aim that every KAMBE member will own his own vehicle.

The success of the mobile money platform for subscriptions has also got the ATGWU thinking about developing a mobile application to be used for organizing, communication, feeding member information into a data base, and generally enhancing accountability of the union and its associations to the membership. 

The mobile money member dues app, it seems, was just the new idea ATGWU needed to ignite the future of building stronger – and perhaps even more digitally connected – worker organizations and movements.

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The App Project is being supported by the International Transport Workers Federation (ITF), of which ATGWU is a long-standing affiliate. 

We would love to hear from other informal worker organizations who are using mobile money platforms either for collecting dues or for any other purpose. We would also love to hear how mobile money platforms are being used by individual informal workers in their day-to-day work. 

Mobile money operators and their countries of operation include Easypoiso and Simm (Pakistan); Vodafone, owned M-PESA (Kenya and 18 other countries worldwide); Fortis Mobile Money (Nigeria); MTN Mobile Money (Uganda, Ghana, Rwanda, and Benin); Tigo Cash (Ghana, Tanzania, Paraguay, El Salvador, Brazil); Movil (Colombia); Airtel Money (Uganda, Rwanda, Burkino Faso, Chad, and India); bKash (Bangladesh); Wing (Cambodia); EcoCash (Zimbabwe); GCash (Philippines); Tigo Money (Bolivia, El Salvador, Paraguay, and Guatemala); Boom (Mexico and Haiti); Grupo Sicom (Argentina); Oi (Brazil); Vivo, owned by Telefónica (Brazil). Mobile money has not taken off in countries such as South Africa, where mobile money services are included under tight banking regulations.

Feature photo: J. Barrett