OFF THE CUFF: Cell phones changing low-income budget priorities

PANAMANIANS spend more on their cellular phones each year than all the homes in the country spend on electricity and when there’s a choice between recreational activity or topping up a prepaid card, the card wins.

 The change in economic priorities is reflected in the latest figures for cell phone usage showing that 584 million went into the coffers of the big four providers in 2013.
The total amount spent on electricity was $388 million, 150 million less than in mobile communication.
Panama has 5.6 million customers with active prepaid lines, which represent 90% of all mobile phone users by Telefónica, Cable & Wireless, Digicel and Claro. Contract customers total 621 000 (10%), which brings the total of users to almost double the population of the country.
According to an unscientific survey of the Authority for Consumer Protection and prepaid cell phone cards are among the items bought by Panamanians. They also lead to log jams at supermarket checkouts, where cards are kept in a drawer and become add-on purchases, followed by a handwritten logging of the sale after the groceries have been tallied.
Although it is not a basic need, this expense is one that weighs heavier on individual and family budgets of low-income groups.
“Previously families saved for going to the movies or to a recreational activity, but now the money that is saved in many families to buy phone cards,” said Giovani Fletcher, president of the Panamanian Institute of of Consumers and Users Rights reports La Prensa.