4.5.2 Behavioral mapping can help an institution design better solutions
The behavioral mapping process has three tenets. The first tenet focuses on defining the desired outcome or defining the problem. The second looks at diagnosing the psychological/behavioral issues that keep people from achieving the desired outcome. The third tenet involves designing small and low-cost tweaks to programs and policies to help people overcome the obstacles to achieving their desired outcome. Ideas42 spends a good deal of time defining and diagnosing the problem because getting the problem right will help identify the real behaviors that need to be addressed. For example, we may ask, “how do we get people to think savings is important?” Phrasing the problem this way, however, assumes that we already understand the bottlenecks. Perhaps people already think it’s important but they don’t know how to open an account, or maybe it’s difficult to enroll, or maybe they think they aren’t eligible for a savings account. If we reset the outcome to a measurable result, such as, how do we increase enrollment in savings accounts, we are more likely able to diagnose why people aren’t saving. The programmatic examples in the following text boxes illustrate some of the real behavioral solutions being tested to improve savings habits among youth.
Ideas42 is currently testing a product that establishes the discipline of saving and then leverages that habit to reduce the risk of a loan. First, ideas42 defined the problem: families in India are not spending enough on perinatal healthcare, nutrition, and other expenses surrounding childbirth. That led to a diagnosis: families were not beginning to save early enough in the pregnancy in order to repay loans. This diagnosis led to the design of a financial product. Women are asked to save a specific amount per month (that they choose) over the six months prior to childbirth. At delivery, the savings are returned along with a loan that is three times the amount saved. The loan repayments are made over the next 18 months so that they are roughly the same as the savings deposits. Loans are only disbursed if no savings deposits were missed. This method not only helps to form a habit but also tests the family’s ability to afford the loan.
Making Cents International researched youth savings behavior in Haiti to support MFI Fonkoze in the development of a savings product. The problem Fonkoze seeks to solve is expanding their youth client base. Its research revealed a diagnosis that youth aspire to be independent, to continue their studies and to earn money through their own business. In response, Fonkoze designed the product to launch at the beginning of the new school year, or at a time when savings would be important, so that youth can immediately see the value of savings products. The market research also revealed the tremendous cultural significance of lotteries in Haiti. As an additional incentive (design) to save, Fonkoze enters youth who participate in a two-hour financial literacy session, into a raffle to receive productive assets such as small livestock or bicycles. This addressed the psychology of limited self-control by enabling young people to meet their savings goals by putting in place what may appear to be a “quick win” incentive.