hanks to the Praekelt Foundation, teenage girls in poor areas of South Africa will have access to a digital savings account that’s run by text messages.


I learned early that it was important to have dreams. And if I worked hard enough and saved my money, I could make those dreams come true. In order to spend a summer in Ireland with one of my friends, when I was 14, I worked at McDonald’s and saved a lot of my take-home pay. When I wanted to travel to Barcelona, Spain, as part of my high school’s international exchange program, I took on extra hours and saved money from my job as a cashier. The lesson I learned: Work hard, save your money and you can make your dreams come true.

In a few months, some teenage girls in poor areas of South Africa will be able to start to make some of their dreams come true with access to a digital savings account that’s run by text messages. According to the MIT Technology Review, this new digital savings program is part of a mobile social network already used by these girls. The teenagers will be able to earn and save mobile airtime credit in return for sending messages, reading things and doing other activities on the mobile social networking service.

While it’s a foreign concept to me, according to The Economist, pre-paid minutes can be exchanged for cash and used to buy things in shops in the Ivory Coast, Ghana, Egypt, Nigeria and Uganda.

The “currency” that drives this new digital savings program is Stellar, which shares a name with a nonprofit whose aim is to efficiently move money around more cost effectively than banks. Somewhat like Bitcoin, Stellar relies on cryptographic software to create digital tokens that are counterfeit-proof. Unlike Bitcoin, Stellar acts as an intermediary between conventional currencies, rather than replacing them. This new digital savings program is powered by software called Vumi. Developed by the Praekelt Foundation, Vumi supports the mobile social networking service where these teenage girls are already spending their time.

Gustav Praekelt, who runs the Praekelt Foundation, told the MIT Technology Review that the girls on Vumi’s existing social networking services can opt in to the digital savings feature, and it will be aimed at teenage girls living in poverty. For most of the girls, it will be their first opportunity to have a savings account, he says, something he hopes will lead to better decisions about money.

South Africa is one of several countries — including Indonesia — where the new savings services will be tested in coming months. 

Top photo credit: Vumi/Maluleka & Nic Voutsas