Published in: 2014
RAND Corporation, Santa Monica, USA
Luoto, J. E., Levine, D. I.
Uptake of safe water products remains low, in spite of modest cost. We experimented with a sales offer that combined a free trial and rent-to-own payments for durable filters. Purchase rates doubled under this sales offer to 31% compared to a traditional lump-sum sales contract. To lower transaction costs we collected payments using Kenya's vast mobile banking network, MPESA. Mobile repayment rates were low; many filters were paid only when a vendor came in-person to request payment, which adds social pressure. While the rent-to-own offer is attractive, more work is needed to reduce transaction costs in rural and peri-urban Kenya.
Luoto, J. E., Levine, D. I. (2014). Mobile phones, rent-to-own payments and water filters - Evidence from Kenya. RAND Corporation, Santa Monica, USA
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