PAKISTAN

Modest

Upholders

aspiring, deliberate, scrupulous

41% of adult population  |  52.8 million people

 

Mostly low to middle income, poorly educated, rural, married women, Modest Upholders are slightly younger than Pakistanis on average and less educated. They are strong financial managers who tend to coordinate family finances despite not being the primary or formal financial decision makers in their families. They are among the most frequent deliberate, goal-based savers and dependable borrowers in Pakistan, doing so primarily through family, but also informal groups. They are future-oriented planners with high self-esteem, but feel limited in their agency. Most find financial services complex and they are split in regards to trusting banks.

Modest Upholders

Pakistan Average

FINANCIAL DECISIONS

myself

20%

38%

spouse or other people

72%

53%

EDUCATION

no education

48%

38%

primary education

20%

22%

PHONE

own smartphone

17%

19%

feature phone

45%

52%

LAND

own land

23%

30%

commonly own

38%

32%

GENDER (FEMALE)

79%

51%

AGE (18-24)

15%

13%

GEOGRAPHY (RURAL)

62%

59%

SOCIOECONOMIC

49%

SES 1-2

FORMAL ACCOUNT

OWNERSHIP

10%

18%

INFORMAL

FINANCIAL USAGE

18%

15%

MOBILE WALLET

OWNERSHIP

3%

5%

TECH USE

(HIGH FREQUENCY)

79%

64%

 

DEMOGRAPHICS

Who are they?

“Times have changed. Children need things.

These days, my daughters have to be educated. If they’re

educated, they can become financially independent.”

SADIA

SOCIOECONOMIC STATUS (SES)

Modest Upholders

Pakistan Average

Demographics


Modest Upholders are mostly low to middle income, poorly educated, rural, married women. They skew slightly younger with more youth and middle aged members than Pakistan overall. Two thirds of Pakistani women fall into this segment. Many non-elder Pakistani men in joint households are Modest Upholders. Most in the segment report that they do not participate in household financial decisions.

Amongst the 47% of Modest Upholders who report that their spouse makes household decisions, 99.5% are female. Amongst the 26% who report that “other people” make their financial decisions, 63% are female, suggesting that both men and women in this group may be non-elder members of joint households. Amongst the 20% who report making their own decisions alone, 53% are female, suggesting there are a number of female heads of households within this segment.

HOUSEHOLD DECISION MAKING

Modest Upholders

Pakistan Average

RESILIENCE: SOURCES OF MONEY IN AN EMERGENCY

Modest Upholders

Pakistan Average

Social Network

Modest Upholders can draw on more people when sick than all but Communal Elites. While slightly over half are not confident in their ability to raise emergency funds, they are more confident than the average Pakistani despite their below average low socioeconomic status and high income volatility. Nearly half rely on social sources for financial support in emergencies and over one third use personal sources. This suggests that not all are able or choose to rely on their networks for assistance. Given the strong savings behavior of roughly half the segment, some may be able to rely on their financial reserves.

ASPIRATIONS

What do they want?

Modest Upholders aspire to keep their family’s finances in good order and their needs met. Given their reported household roles, they focus particularly on daily expenses and educational investments. They may also aspire to boost their family’s earnings by guiding investments in family business initiatives, including those which they may lead.

 
 

BEHAVIOR

How do they manage their finances?

“Your family knows about your financial status,

so you feel comfortable borrowing from them.”

SADIA

Financial Behavior Overview

Modest Upholders’ overall financial behavior is close to average for Pakistan. This may not be surprising given they make up 40% of the overall population. Still, in light of their low SES, high income volatility, and reported lack of control over their finances, this suggests they are making the best of challenging circumstances.

BEHAVIORAL INDEX
FINANCIAL ACCESS

Modest Upholders

Pakistan Average

Financial Access

Modest Upholders primarily manage finances through family. Their rates of bank account and mobile wallet ownership and usage are well below average, though they are above average members and users of informal groups. Most find financial services complex, which in addition the restrictions on mobility and account ownership women in the segment face, may drive low rates of formal ownership.

Financial Priorities

Modest Upholders aspire to keep their needs met and their family’s finances in good order, with a particular focus on daily expenses and education investments. They may also aspire to boost their family’s earnings by guiding investments in family business initiatives, including projects they may lead. Modest Upholders would reserve the largest share of a windfall for cash reserves, suggesting they prioritize smoothing income, meeting expenses, and maintaining good standing with creditors who may provide crucial liquidity. They would also allocate over a quarter to investments, suggesting a strong desire to grow their household income.

HOW WINDFALL IS PRIORITIZED

Modest Upholders

Pakistan Average

HAS A PLAN TO MANAGE EXPENSES

Modest Upholders

Pakistan Average

Financial Plans

Most Modest Upholders identify as effective planners, about half plan expenses, and nearly two-thirds are save deliberately despite low SES, high income volatility, and having limited control over household financial decisions. Perhaps due to a division of household roles along gender lines, Modest Upholders are more likely than all but the Communal Elites to have a plan to manage their expenses.

Shaping Income and Expenses

Most Modest Upholders experience moderate to high expense volatility at above average levels for Pakistan, yet they are among the most effective expense managers. This suggests they effectively manage liquidity to meet daily household needs and pay short-term bills, in line with their priorities.

INCOME VOLATILITY

Modest Upholders

Pakistan Average

SAVINGS FREQUENCY

Modest Upholders

Pakistan Average

Building Reserves

Just over half of Modest Upholders save, and two fifths do so frequently, monthly or more, making them the second most frequent savers in Pakistan. They prefer to save with family or at home, and do so more frequently than any other segment. They save deliberately and while most savers among them actively use only one channel, a significant minority use multiple channels despite low formal account ownership. Less than a quarter personally own land or livestock, the lowest rates among segments, though over a third report commonly owning land.

Cultivating Receivables 

Modest Upholders are Pakistan’s second most frequent borrowers and those who borrow tend to use multiple channels quarterly. They especially favor borrowing from family, but are often likely receiving direct support rather than loans. 27% borrow at least once every three months (the highest quarterly rate amongst segments), yet 56% never borrow at all (second-highest rate).
The consistent character of this borrowing suggests that they plan and manage sufficiently well to repay on time, maintaining credit worthiness. They may borrow as a strategy to
meet household expenses and make ends meet
at months end, rather than to cover emergencies. In fact, most rely on personal financial resources in emergencies instead of social support.

BORROWING FREQUENCY

Modest Upholders

Pakistan Average

CONFIDENCE IN ABILITY TO RAISE EMERGENCY FUNDS

Modest Upholders

Pakistan Average

Modest Upholders have faced an average number of financial emergencies over the past two years, and primarily rely on social sources of financial support to deal with them, buoyed by their ability to frequently borrow from family. However, nearly as many have relied on personal financial resources — mostly savings — to manage emergencies in the past two years.  They are slightly more confident than average in their ability to raise emergency funds.

Technology Usage

Most Modest Upholders use digital technology and consume media at a low level. Though most have access to feature phones, they report significantly below-average phone ownership and usage. Most do not text and very few access internet or social media. The prefer instead TV, with nearly half tuning in once a month or more.

PHONE USAGE

Modest Upholders

Pakistan Average

 

PSYCHOLOGY

How do they think?

"My husband doesn’t think the same way as I do. He doesn’t think

our daughter should be educated. I try to reason with him, but if that doesn’t work, I ask my mother to talk to him."

SADIA, PAKISTAN

Self-perception

Modest Upholders report a weak sense of agency but high self-esteem. They feel that much of their life and many of their outcomes are beyond their control, and they have limited ability to change their lot. Nevertheless, they are hopeful about their future prospects. We have found that their external locus of control in part drives their high frequency of saving with family and at home. Perhaps they perceive safety and control in the proximity of family and home savings, providing a hedge against the chaos and unpredictability of the world outside. Moreover, we have found their positive view of the future drives their higher rates of saving with informal groups and friends.

LOCUS OF CONTROL

Modest Upholders

Pakistan Average

OPENNESS

Modest Upholders

Pakistan Average

Conscientiousness and Openness

Most Modest Upholders are conscientious and although over half identify as impulsive spenders, also consider themselves effective planners. Nearly half have a plan to manage expenses despite low SES, high income volatility, and limited financial decision making authority in their homes.

 

Moreover, most are future-oriented and deliberate savers. Nearly three quarters are open minded, second only to Communal Elites, which we have found to in part drive their increased borrowing from family, as well as their relatively greater ease managing expenses despite their challenging context.

Attitude Towards Savings

Modest Upholders are conscientious and effective planners and despite exhibiting some spending impulsivity, they are future-oriented and deliberate savers, likely saving cash to manage household expenses and build towards savings goals. While four-fifths feel they do not earn enough to save and nearly two-thirds feel their savings are not safe from the demands of the network, they still save frequently and primarily with family, friends, and informal groups. Women in the segment realistically may lack access to formal channels, and their low perceptions of the safety of their savings may represent an opportunity for providers.

SAVINGS DELIBERATENESS

Modest Upholders

Pakistan Average

DEPENDABILITY

Modest Upholders

Pakistan Average

Attitude Towards Debt

Amongst Modest Upholders, 61% agree to strongly agree that their community would be willing to offer loans or support to invest in their businesses and children’s education — by far the highest level amongst all segments. This strong belief in the likelihood of receiving financial support from their community for non-emergency needs suggests that Modest Upholders cultivate extensive, durable social financial networks.

Trust in People

Overall, Modest Upholders are very trusting of people, including when it comes to lending to family and friends. They also believe their network would provide them with support for business and education investments if needed. Their trust may in part drive their high rates of saving and borrowing with family, as well as their above average use of informal financial groups. Yet, most view their communities as unequal, and lightly less than half have relied on their network for emergency support in the past two years.

BELIEF IN COMMUNITY SUPPORT
FOR BUSINESS AND SCHOOL FEES

Modest Upholders

Pakistan Average

TRUST IN BANKS

Modest Upholders

Pakistan Average

Trust in Institutions

While Modest Upholder trust their community and social financial network most, they also strongly trust institutions, though at slightly lower rates. They trust government and media more than any other segment, and more so than they do banks, where they are split with equal numbers trusting and distrusting banks. Despite this, Modest Upholders have the second highest trust in banks after Communal Elites.  

Gender Attitudes

Most Modest Upholders believe that men are better financial managers than women. While slightly more men, overall, hold this view, women who agree tend to feel more strongly about it. Nearly all Modest Upholders believe that wives and husbands should know each other’s financial affairs and that girls and boys should be educated about money in the same way, but women in the segment agree more adamantly with these views than men.

GIRLS AND BOYS SHOULD BE EDUCATED
ABOUT MONEY IN THE SAME WAY

Modest Upholders

Pakistan Average

OPPORTUNITIES

How might we leverage frequent savers and

borrowers amongst women and develop products

and campaigns that enable them to act as agents

for women-targeted financial products?

+

How might we create products and services

that equip women to teach their children, especially daughters, to be effective financial managers?

 
 

USER PROFILE

 

Sadia

"My husband cannot be bothered with

the dramas and expenses of the household."

 

 

Sadia is a middle-aged woman and mother of five (ages 7-16), living in Rawalpindi. She runs a small tailoring business from their home to supplement her husband’s earnings with extra income. Her mother showed her how to use discerning logic to overcome problems in life and taught her the value of savings, the importance of education, and the need for financial independence. Now, Sadia’s main motivation is to be a good mother and, in particular, to provide her four daughters the tools they will need to be secure and financially independent in life.

USER INSIGHTS

Stigmatization of Borrowing Constraints Opportunities for Investment in Business and Education

Sadia wants to provide her 4 daughters an education and bring them into her tailoring business with hopes of growing it. Yet, she feels that borrowing is shameful, so will try to finance these financial goals through savings alone.

 

Sadia would benefit from a loan to support investment in her tailoring business to become more efficient and productive, or to finance her four daughters education.

Destigmatize Loans by Characterizing Them as Investment

Sadia not only feels that borrowing is shameful, but experiences anxiety around payments. Despite having never missed a payment, she constantly worries that she will. In a sense, this anxiety driver her attentiveness to her repayment schedule and reduces the risk that she will miss a payment, but makes it more unlikely that she will borrow again.

 

Sadia needs a loan product that is framed as an investment product and equipped with features that relieve her anxiety around missed repayments, whether through reminders, generous grace periods, or recharacterizing repayment all together.

 

 The Human Account is led, created and developed by Dalberg with Rockefeller Philanthropy Advisors, and funded by the Bill & Melinda Gates Foundation.

 

Local partners are Lagos Business School in Nigeria, Ashoka University in India, not-for-profit development finance company, Karandaaz in Pakistan, and research and advisory firm, Busara Center for Behavioral Economics in Kenya.