One of the challenges found in research on development economics relates to demonstrating the importance of saving. For some time, there has been a tendency to think that saving propensities determine the rate of communities' growth.

This summer I had the opportunity to participate in a research project in Mozambique on the role of technology in improving small businesses' ability to save, commissioned by the Central Bank and implemented by the Universida de Nova de Lisboa (Portugal). The interesting thing about this country is that it is the fastest growing non-oil dependent sub-Saharan African nation; according to the World Bank, in the past two decades, it has seen an annual growth rate of approximately 7.2%. However, despite this staggering figure, it has not succeeded in creating an inclusive society. More than half of the population lives on less than 50 cents a day and only 12% of adults make use of formal banking products or services. Of this percentage, 77% live in urban areas.

Mobile technology is prevalent in Africa– it has nearly one billion users—and has enabled easily extending banking services to the poor. Studies in sub-Saharan Africa show that less than one in five households have a bank account, but in Kenya, for example, they have extended mobile banking and, in just over five years, 70% of the population now manages bank accounts through this system.

We conducted this project's field work in Maputo, an expanding city with more than two million inhabitants, including the suburb of Matola. The aim was to measure why changes in savings rates occurred. Through a data collection methodology called Randomized Controlled Trial, we randomly selected micro-businesses  from the 23 outdoor markets, including beauty products, rat poison, food, etc. We formed four groups with the following interventions: mobile banking, financial education (teaching concepts such as direct costs, gains and losses), mobile banking and financial literacy, and a control group where no interventions were made, but that allowed comparison.

I particularly remember one of the interviews we did with a food vendor in the Xiquelene market. The interviewer had explained to him some terms— buying, costs, gross profit and net profit, etc. With great ease, the food vendor wanted to show that he had understood the explanation and said, "What I want to know is how much money I made at the end of the day!" We emphasized that this was possible in a given period (weekly, biweekly, monthly ...), and our answer satisfied him, but I am still trying to find a solution to the problem he posed to us.

The Zimpeto market is noteworthy for its size; micro-entrepreneurs have larger businesses because they know the terrain. Interestingly, they asked us questions before we interviewed them. One of the hardest was how our study would benefit their business.

One day, after gaining her trust, one of the researchers told a grain seller that net profit could be crucial to a company's investments. The woman stared at us and said, "Look!  Profits do not exist; there are only money movements. Buy low and sell high, pay salaries, monthly rent and the monthly market tax. This business allows me to have enough to eat and pay for my children since I am a single mother ... what profits are you talking about?"

Our conversations made me realize that micro-entrepreneurs are not as ignorant as is often supposed. A finance student could not have answered better and this grain seller had never even been to a business school. She was right in referring to "movements:" the term "profits" is an accounting construction.

The results of the study, to be published next year, are another step in the long road ahead of understanding how to promote micro-savings and how this can be used to implement policies that ensure not only the economic growth of countries, but also the economic development of the poorest people in Mozambique, Africa and throughout the world.