Electronic money keeps vulnerable locals smiling

CASH FROM PHONE—A participant gets her share through e-transaction

By Francis Tayanjah-Phiri, contributor:

There was a time Fanny Moses and others used to brave the scorching heat or heavy rain as they queued for hours at a nearby school to get their share in the Social Cash Transfer Programme (SCTP).

The school is a stone’s throw from Moses’s house, but she could not go back home when the weather got bad for fear of losing her spot on the winding queue.


It was the case with several other SCTP participants from Ndoya Village, Traditional Authority Nsamala in Balaka District, where Moses also comes from.

The 42-year-old widow says the money offered a lifeline for vulnerable households like hers.

“It still does,” she says, a bright beam registering on her face.


Moses, who has a physical disability in the arm, was grappling with grinding poverty before she was registered in the SCTP, a facility aimed at improving livelihoods of vulnerable populations in the country.

By providing monthly cash transfers to ultra-poor and labour-constrained families, the programme helps them to meet their basic needs and build resilience, with the ultimate goal of building human capital and moving them out of poverty.

For many participants, the cash has been handy in meeting school needs of their children, building new houses, engaging in business activities and purchasing livestock for rearing.

“When my husband died in 2020, life became so difficult for me. I could hardly afford to support my six children. Later, things started to improve when I was enlisted as a beneficiary of the programme,” Moses says.

She admits that without the cash, her son and daughter, who are in forms Four and Two respectively, would be out of school as she had been struggling to pay their fees.

Known as Mtukula Pakhomo in vernacular, such social protection programmes are being implemented by the Malawi Government through the ministries of Local Government and Gender, Community Development and Social Welfare.

Some non-governmental organisations also provide cash transfers to targeted vulnerable households.

“It is my wish that from the small business of selling farm produce that I ventured into using the money I receive through the programme, I will continue supporting my children up to university level,” Moses states.

She is now happy that she and other participants no longer queue for hours to get their shares following the migration of the payment system into an electronic one.

In their case, they get their money through TNM Mpamba, one of Malawi’s mobile money services providers.

“In the past, apart from spending hours on queues waiting to receive the cash from officers who came to disburse it, we also risked being robbed by thieves who could trail us,” Moses says.

She waxes lyrical about the electronic money transfer system, saying it is allowing her to choose when to redeem the money.

“I can receive a message today that I have received the money, but choose to redeem it even a week later, depending on needs,” Moses boasts.

The arrangement is further said to be augmenting financial inclusion among vulnerable populations who have mostly been left behind in the past.

“We can now properly plan how to use the money. There is no burden of immediately disposing off the cash once we receive it,” Edwin Fillipo, another SCTP participant, says.

He further praises TNM for allowing beneficiaries to acquire gadgets through what he calls a flexible credit facility, saying many of them could not afford the phones on their own.

“Most of us have since repaid the loans through the same Mtukula Pakhomo initiative. It is like killing two birds with one stone,” Fillipo says.

A TNM Mpamba agent from Balaka Township, who also travels to other nearby rural areas on call, Francis Tembo, says SCTP has helped in creating jobs for many youths in the area.

Tembo says as beneficiaries engage in money transactions, they have increased traffic and created room for more agents to meet the demand.

TNM Mpamba Limited General Manager, Chris Sukasuka, says while serving its clientele, the mobile money platform is also contributing towards the attainment of Malawi 2063.

“The Malawi 2063 vision seeks to enhance financial literacy which is crucial to the development of the country. Mpamba is improving financial inclusion as people in the rural areas are able to understand some basic information about finances,” Sukasuka says.

E-payment for social cash transfer on TNM Mpamba Limited is currently being implemented in 15 districts across the country.

Under the programme, the Government of Ireland is supporting more than 25,000 households in Ntcheu and Balaka districts.

Recently, Ireland Minister of State for International Development and Diaspora, Sean Fleming, praised the convenience and reliability that the e-payment system has brought in the disbursement of money to ultra-poor and labour constrained households in Malawi.

Fleming visited Balaka to appreciate how a Mtukula Pakhomo project that his government is funding is performing.

“I am impressed to see cash being disbursed using cell phones because in other countries that we visit, beneficiaries get their money in cash.

“The mobile money platform is doing a lot in making lives of Malawians better. Mpamba is an excellent facility because it enables beneficiaries to save money, pay their bills and do cash-outs on their phones,” the envoy said.

The e-transaction, which is being praised by SCTP participants and officials, began with the signing of an agreement between TNM Plc and the Ministry of Gender, Community Development and Social Welfare.

The SCTP 2022-2027 Strategic Plan states that the initiative is framed as to provide regular, adequate and timely cash transfers in a manner that preserves dignity.

It protects the poorest and most vulnerable citizens from the effects of ultra-poverty, promote their livelihoods, prevent further deprivation as a result of livelihood shocks and contribute to human capital development, according to the plan.

The transfer is unconditional, meaning participants are free to choose what to spend the money on.

A fact sheet on SCTP states that over 1.3 million people are reached annually with over K13 billion.

“Evidence shows that the most common purchases include food, livestock and agricultural inputs like tools and fertiliser.

“Beneficiaries also use the cash transfers to pay school fees and buy educational supplies such as uniforms and shoes.

“These investments reduce hunger, increase crop production, grow household assets and result in significantly more children going to school instead of working to help support their families,” the fact sheet reads.

It adds that the cash transfers also benefit local economies as the participants spend the money in local stores and increase education rates in the community.

According to the fact sheet, which was published in October last year by the Ministry of Gender with support from Unicef, many participants are also involved in other social protection programmes “to enhance households resilience, such as savings and loans groups, providing additional community gains and more solid pathways out of poverty.”

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