Digital Economies and Poverty Reduction
Target – 1.4: By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership and control over land and other forms of property, inheritance, natural resources, appropriate new technology and financial services, including microfinance
The world economy is transitioning into a digital global economy. The ongoing digitalisation across global and local spheres, spanning markets, logistics, mobility, public services, and social protection systems, presents a dichotomy. On one hand, it fosters broad inclusivity and facilitates quicker, more effective solutions for those already adept at utilising digital tools. However, individuals situated on the fringes—due to limited infrastructural outreach to remote regions, linguistic barriers in digital interface, or other accessibility impediments— may instead face the peril of further marginalisation.
Amidst the multifaceted challenges of climate change, emergencies, and societal upheavals, digital technologies emerge as pivotal instruments for fortifying resilience, broadening skill sets, and diversifying livelihoods. Yet, the absence of proficient digital skills disproportionately excludes numerous small-scale producers from both local and global markets.
Whether cultivating agricultural yields, crafting traditional goods, or offering services, their limited digital prowess hampers market access and diminishes opportunities for growth.
Moreover, the digital revolution has the potential to democratize access to a plethora of support systems and subsidies. From enabling smoother access to social security benefits to streamlining the application processes for subsidies or health insurance, digitalization strives to level the playing field by making essential services more available and navigable for all individuals.
How SPIDER promotes inclusive digital economies to reduce poverty
When COVID-19 became a global pandemic, introducing restrictions on mobility and public everyday life people across the globe were forced into acquiring new skills not only to carry out their professions but also to find alternative ways to make a living.
The pandemic was especially hard on informal workers who rely on daily earnings to support themselves and their families. With strictly imposed lock-downs and stay-at-home orders it was especially challenging for informal sectors to transition to digital opportunities. To bridge this gap, SPIDER supported two separate projects: one in Bolivia working with Aymara artisan women and one in Rwanda focusing on women street vendors in Kigali.
Beyond practical initiatives like the aforementioned, regulations and policies to address consumer rights and build e-commerce infrastructures through our partnerships with regulators is essential for the empowerment of people, especially women, to use innovative technology solutions to take part of the global economy,
Comunidad Andina Suma Satwi (CASSA)
The Aymara women were within the ages of 30-59, had an average of 4 children and their economic mainstay was as weaving artisans in textile and weaving jewelry among others. Their knowledge of internet use was limited to social media messaging and after the training, research underlines that:
- The women took their first step in the virtual world through smartphones
- The women discovered the global market as an unlimited space of possibilities
- The women have become empowered because despite their ages and levels of education they have discovered technological skills
Research uncovered the additional services that must be in place to support digital forms of commercial enterprises, the Aymara women needed to acquire skills in mobile banking.
Rwandan Youth Voice for Change (RYVC)
The street vendors in Kigali’s ages range from 20-46 and they have spent an average of 4 years street vending due to limited education, and they met the proposal of a digital market place with high expectation. Some of the benefits that the digital market place offers the street vendors include:
- Wider customer reach beyond Kigali
- Safer transations made through mobile financial services
- Empowered vendors that are organised and carry out their business from ”anywhere”
The street vendors in Rwanda needed to incorporate within the digitial bouquet of services, product delivery, and payment features.
Impact
CASSA developed a digital platform within the project, while RYVC through its technical partner developed an online trading platform. CASSA supported 40 women and provided smart phones to enable them to create Instagram pages for their products, and by extension Facebook. Similarly, Agataro is available on Instagram and Facebook, which has expanded commercial activities beyond the physical locations of the vendors.
For the street vendors of Kigali and the Aymara women, this is a new way of working, marketing products and communicating with their customers. As the Aymara women asserted this allows them to ”sell our products directly, so the big companies will not take advantage as they always do.”.
Research also sought to learn more about the women. Some unexpected outcomes include the support these women were able to give their children with online learning. The digital skills they were were trained in allowed them to ”even now it [smart phone] will help us for our children’s classes”. In addition to supporting their children with online schooling, the women were able to continue socialising with their families through Facebook. This has awakened an appetite for furthering their education and especially technical knowledge.
Impact of the project
%
Some of the women in the projcct increased their income threefold
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F.A.Q.
What do Information and Communication Technologies (ICT) have to do with poverty reduction? How can marginalised groups use technology to access opportunities that they previously have been excluded from?
How can digital technologies contribute to poverty reduction?
Digital technologies reduce poverty by providing financial inclusion, entrepreneurship, education, healthcare access, and job opportunities. They enhance government services, information access, economic inclusion, and community development, fostering global poverty alleviation.
What role does digital literacy play in poverty reduction?
Digital literacy is key to access and utilize digital tools effectively and make it possible to participate in a digital society.
Which are the ethical considerations to using ICTs to reduce poverty?
Addressing issues like data privacy, digital rights, and ensuring that the technology do not exacerbate existing inequalities is key.