Political economy of financial inclusion in Lesotho: Mobile money and the experiences of low-income and rural communities

This paper examines the development of mobile money in contemporary Lesotho, 2012-2020. Using historical and ethnographic sources, it situates the development of this mobile phone-based financial system within the broader economic history of the country. It adopts a political economy approach to analyse the emergence and evolution of mobile money as an instrument of financial inclusion used by the government of Lesotho and international organisations. The paper advances that when operating with the logic of capitalism, free market policies, emergent mobile money networks are hierarchically structured and privileges enterprises and corporations with bigger financial muscle. The majority of small agents, the Basotho entrepreneurs, are marginal and have to operate precariously with limited capital and low cash-flows to ensure efficient services for the people. As a corollary to this, the rural poor are further excluded and exploited by the agents. A general assessment advanced in the article is that the rigidly defined digital eco-system is geared towards integrating the lower echelons of the economy asymmetrically into the mainstream financial economy dominated by corporations. However, this cannot be defined as any meaningful financial inclusion.