E-commerce as a Tool for Digital Financial Literacy: Lessons from Bangladesh

A publication by UNCDF explores sustainable avenues for the delivery of digital financial literacy (DFL) to small and micro businesses (SMBs).

A publication by UNCDF explores sustainable avenues for the delivery of digital financial literacy (DFL) to small and micro businesses (SMBs).

DFL is a young field in education; so young that concordant definitions and effective modes of delivery are yet to be fully established. The consequences of low DFL are becoming more noticeable worldwide, with governments and the private sector undertaking a series of initiatives in a bid to address the issue.

Among the initiatives is a project run by UNCDF and VISA in Bangladesh. Reports show that over 80% of the country’s youth lack digital skills.  

SMBs in the East Asian country are struggling to cover wages, pay supplies, and fulfill credit obligations as they failed to embark on digitalization during the COVID-19 pandemic, largely due to gaps in digital and financial literacy. The project focuses on using e-commerce to promote DFL as a tool to help the businesses regain their footing. 

Participating SMBs took part in five basic learning modules tailored using pre-assessment and global best practices. The pre-assessment identified Internet and mobile usage patterns of potential beneficiaries. Although owners of SMB are aware of how to use the internet and social media, their usage of digital outlets for business purposes was found to be low.  

The lessons were delivered through a virtual platform, in-person training, email, SMS, and social media. The modules cover issues like creating a business plan, basics of financial management, Promoting a business and transitioning to an e-business.  Project runners say the next steps will involve advanced learning modules. 

The modules were delivered on two local platforms that managed to reach over 100,000 business owners. Due to the different delivery methods each platform employed, differing outcomes were observed.

In addition, the results indicate that participants’ educational level are a key determinant of knowledge gained and progress made through the modules. Gender, on the other hand, had little effect, with men performing better on certain topics but women faring better on others.

The following approaches were beneficial for a market segment with lower than average internet and digital services adoption and comparatively less education, particularly in regard to women:

  • Combining a labor-intensive field-based delivery model with virtual components.
  • Training in small groups (of five to seven people).
  • Aligning delivery with time constraints and availability. 

For beneficiaries with higher than average internet and digital adoption and comparatively higher levels of education: 

  • Developing or leveraging a dedicated project platform to embed modules rather than existing platforms such as YouTube.
  • The pattern of the use of communications channels by target audiences can assist in determining the delivery pathway.
  • Certificates can incentivize progression through the entirety of a learning course.

The report features several recommendations for content, deployment channels, and sustainability based on project insights. Advice for future DFL initiatives to be implemented elsewhere includes:

  •   Ensuring the contents deploy a narrative format with engaging characters and realistic scenarios 
  • Developing and crystallizing a storyboard framework at the outset to ensure that the narrative flow of the ultimately selected episodes or modules is coherent and well-integrated without being too simplistic. 
  • Adopting a clear product-oriented and solution-driven approach that helps participants tackle their own real-world problems. 
  • Relatively small groups of five to seven people can promote learning better than smaller groups or one-on-one training as engagement between participants can drive learning through discussing solutions to a problem in the training. 
  • Keep adult learning principles in mind when designing the content and delivery method of such digital financial interventions. 

You can read the full publication here.

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