NB Financial Health
Cashless Education: How mobile money helps Bridge International Academies deliver quality for-profit education for $6 a month – Part 5 in our Digital Finance Plus series
Editor’s note: This is the fifth and final post in our series on Digital Finance Plus. Published in collaboration with CGAP, the series explores the ways that digital finance is being utilized to help provide basic, essential services to the BoP. Discover more in part one, part two, part three and part four of this week-long series.
Bridge International Academies has a longstanding relationship with mobile money. In fact, we were one of M-PESA’s very first corporate accounts. You can tell this from our M-PESA number: 123123. We got to choose it ourselves back in 2009 when we were one of the first companies in the world to integrate mobile money into our operations. Not coincidentally, that is the same year we opened our first academy.
When I say we “integrate mobile money into our business,” I don’t mean it lightly. Mobile money is the only type of payment Bridge accepts. Mobile money is how our students pay their school fees. It is how they pay for lunch. It is how our staff gets paid, how expenses are reimbursed, and how vendor invoices are processed. We don’t accept cash, period, and each of our 300+ academies has the “No Cash” posters to prove it. But our use cases don’t end there. By taking cash out of the equation, mobile money eliminates most of the problems associated with cash payments, thereby helping us maintain our customer focus.
At Bridge, we serve at the pleasure of our parents. Bridge International Academies is the world’s largest chain of pre-primary and primary schools. We have reengineered the entire lifecycle of education delivery from how academies are scouted and built to how teachers are selected and trained and how lessons are delivered and monitored for improvement. Our students score an average of 35 percent higher in reading and 19 percent higher in math than their peers in neighboring schools. And, thanks to data-enabled technology and economies of scale, we’re able to charge our students just $4-$9 a month. While you may be thinking how ridiculously cheap this is, $6 (our average fee) is a lot of money for the typical Bridge parent. Our average family lives on just $1.24 a day per person. While 90 percent of parents can afford our fees, this isn’t a decision they make lightly. This is where mobile money helps the most, by helping to address some of their biggest concerns:
Financial transparency: Kenya’s “free” public education system is notorious for demanding fees as high as $12 a month, often unsanctioned and requested at whim. At Bridge, parents know exactly how much they need to pay and when. Not only is this information posted at every academy, but, thanks to mobile payments and Bridge’s custom software, parents also receive personalized SMS bills and receipts regarding their children’s fees.
Operational sustainability: One of the many problems facing low-income education is the rate at which schools close. Parents live in fear of their school shutting down. At Bridge, students’ fees sustainably support an academy’s operations in full – including teacher salaries, textbooks, manipulatives, utilities, and more. With mobile payments, parents can trust that all of their money is going toward academy operations and that their Bridge International Academy won’t close.
Physical security: Bridge works in many at-risk neighborhoods. By disallowing cash at our academies, we remove the danger of robbery and/or physical harm to our Academy Managers, Academy Teachers, and students.
Educational accountability: Most of the other headmasters in the communities we serve spend their days calculating budgets and accounting completely unaware of what, if anything, is being taught in the classroom. At Bridge, all of that financial planning is automated for Academy Managers using our custom app combined with mobile money. This frees Academy Managers to concentrate on the more important things that need to be done on the ground and can’t be standardized through technology such as teacher observations and evaluations, student mentoring, and relationship building.
Thanks to mobile money – and the custom smartphone and SMS applications we have developed around it – Bridge is able to deliver the transparency, accuracy, and automation that have allowed us to scale from a single academy to more than 300 academies serving 100,000 students in just five years. As Bridge International Academies plans our expansion into Uganda, Nigeria, and/or India in the coming months, it’s clear that mobile money will continue to play an important role.
Marie Leznicki is vice president of brand strategy at Bridge International Academies.