The Rewards of using M-Shwari for the #52WeekChallenge

For the last couple of weeks of the #52WeekChallenge 2019, I have fielded questions on this blog, email, and on Twitter on the best place to save the money. A couple of people asked me if they should send me the money. As much as I love the extra cash, I am not the best person to keep your money for you because you are not likely to get it back :-).

I have however time and time again recommended the M-Shwari Lock Savings Account as the easiest way to sign up for and to start saving for the #52WeekChallenge. I have one main reason, and M-Shwari are giving us three other reasons to save with them.

My reason is that it is easy and frictionless

In financial transactions, friction refers to the time, effort, and cost involved in making financial transactions. There are many ways to save for the Challenge. You can opt to have a piggy bank, a savings account or even save in a SACCO. All those methods involve transferring money from one financial medium to another – in the case of a piggy bank, a manual transfer from your bank account to your piggy bank. M-Shwari Lock Savings however is a savings account that is linked to your M-Pesa Account, and we use M-Pesa these days to pay for everything. Using the Lock Savings Account for the #52WeekChallenge means that you save by a couple of taps.

Here is how to set up an M-Shwari Lock Savings for the #52WeekChallenge using the MySafaricom App or the M-Pesa sim toolkit menu on your phone:

• On the M-Pesa menu, select Loans and Savings
• Select M-Shwari
• Select Lock Savings Account
• Then select Open Lock Account to join
• Set your account to save from M-Pesa
• Set your target at KES 68,900 (this is the minimum amount for the 50 shilling challenge. If you are saving more, input your closing goal. You may use the Money Box App to calculate your savings target)
• On the Period, input 12 months.
• Deposit the first amount. Since we are just coming to the end of week 2, you can save for the first two weeks

With that, you are set to go. Every week, go to the Lock Savings menu and select Save to deposit the weekly amounts.

M-Shwari gives us two more reasons to #SaveWithMShwari this year

1. Unlike say a piggy bank, M-Shwari pays interest at rates that range between 3% to 6% depending on the amount of money in your Lock Savings Account. The focus of the #52WeekChallenge is to accumulate savings, which we either invest, or spend on that thing we have been longing for (it can be a new phone, an emergency fund, or that holiday). While we do not worry too much about earning interest, that extra cash does not hurt. It is better than having the money in a piggy bank.

2. For the first time ever, we will be paid to save money! M-Shwari is rewarding savers and this is something that you can be part of. The first 2,000 people to open Lock Savings Accounts (with their targets set at a minimum of KES 68,900) this week will get KES 1,000 deposited into their Lock Savings Accounts, and for every milestone:

• The first 2,000 people to hit their 3-month savings target will receive KES 1,500 in their Lock Savings Accounts
• The first 2,000 people to hit their 6-month savings target will receive KES 2,000 in their Lock Savings Accounts
• The first 2,000 people to hit their 9-month savings target will receive KES 3,000 in their Lock Savings Accounts
• The first 2,000 people to hit their 12-month savings target will receive KES 5,000 in their Lock Savings Accounts

3. Your deposits into the Lock Savings Accounts go towards increasing your M-Shwari loan limit.  The topmost reason why most people give up on the #52WeekChallenge is an unexpected emergency expense. Withdrawing the savings then discourages them from starting all over again. Sometimes, you just need bridging finance for a couple of days (until you get paid). Instead of breaking your #52WeekChallenge bank, you may find it useful to take a loan that won’t cost you much because you will repay it in a few days.

Go ahead and set your #52WeekChallenge goal for the year. This post explains how to. Download the Money Box app to track your savings, open Lock Savings Account and join me on this exciting savings journey.