Tag Archive for: india

Photo Credit: The Economist

I participated in a very informative event this week in Washington DC where a researcher was sharing his experience on “Weather-Index based Crop Insurance for Smallholder Farmers in Ethiopia”. As I listened to the discussion as an agricultural information specialist, my concern was what is the role of mobile technologies in this?

According to the researcher, Dr. Shukri Ahmed a Senior Economist, Food and Agriculture Organization (FAO), the concept of crop insurance has a long history from Asia with the leadership of India. However, due to the challenges associated with insurance in general and access to credit to smallholder farmers, the idea somehow waned. But according to Index Insurance Innovation Initiative (I4), there is overwhelming evidence that uninsured risk can drive people into poverty and destitution, especially those in low-wealth agricultural and pastoralist households. There is therefore a re-emergence of insurance for smallholder farmers across the globe.

The speaker gave a detailed background to the study in Ethiopia and the importance of partnership in the design and implementation of the study. The difference, however, with this new approach to crop insurance for smallholder farmers is the use of index (indices) to support the insurance service, and intervention against emergency situation. But at the same time the study is targeting farmers that are relatively better off and who are already engaged in the market but are not investing in insurance due to the anticipated risks. The outcome of the pilot study is expected to help protect the livelihoods of smallholder farmers, who are vulnerable to severe and catastrophic weather risks particularly drought, enhance their access to agricultural inputs, and enable the development of ex-ante market based risk management mechanism which can be scalable in Ethiopia.

Dr. Shukri Ahmed, Senior Economist at the United Nations Food and Agriculture Organization (FAO)

Unbanked or Branchless Services

Adding another concept to an already very complex issue that tries to combine weather, insurance, credit/finance, and smallholder farming, should be carefully considered. But the key question is whether mobile technologies can play a catalytic role in this entire complex system?

Among the reasons for choosing a given area for the pilot study, include availability of Nyala Bank branches, the vulnerability of yields to drought, the availability of nearby weather stations, and the willingness of cooperatives in the area to purchase the new product. As the pilot study progresses, the possibility of scaling the project across the country is high. But what will be the implications for the absence of banks in the rural farming communities in a country that has an approximately one bank loan per 1000 adults? Can Mobile Banking help understand why smallholder farmers under-investment in agriculture?

A success story of mobile banking by  the Dutch-Bangla Bank Limited (DBBL) in Bangladesh was recently highlighted by the GSMA Mobile Money for the Unbanked. Interestingly, the story pointed out how DBBL learnt from Kenya’s famous mobile money program M-PESA. Kilimo Salama (KS) is an innovative index-based insurance product that insures farmers’ inputs (seeds, fertilizer, pesticides), and outputs (crop harvests), in the event of drought or excessive rainfall. It uses weather stations to collect data and implements SMS-based mobile technologies to administer and distribute the payouts. Mobile technologies will not only help with the financial transactions such as seen in Kilimo Salama’s case but also in support of the weather stations for timely and accurate decision making for pay-outs.

My conversation with Dr Shukri about the possibility of integrating mobile money into the project to address the challenge of absence of banks in rural Ethiopia, revealed the huge untapped market for Mobile Banking in that country. However, the success of such services depends on a convincing business case for both the banks and Mobile Network Operators (MNOs). Most importantly, however, is the state of telecommunication infrastructure and regulation in the country. These need to be in place for services and applications to thrive. With this huge investment

Outside Ethiopia, I believe it is time for African countries to take advantage of the increasing mobile phone penetrations in the continent beyond social networking to general development applications such as for agriculture, health, education, and rural development.

To listen to the audio recording of the event, visit Center for Strategic and International Studies (CSIS).

Cover Page of the World Bank Report

Photo Credit: The World Bank

There is no doubt that the current surge in mobile innovations for agricultural development is defying the normal progressive growth of agricultural technologies over the past decades. For centuries, innovations in agricultural technologies have been progressively slow. The emergent of information and communication technologies (ICTs) and their innovative use to support agricultural extension and advisory services has, however, changed the history forever. According to the World Bank report Information and Communications for Development 2012: Maximizing Mobile, close to 6 billion mobile phones are in use today, a jump from less than 1 billion subscriptions in 2003. About 77% of the 6 billion subscriptions is located in the developing nations in which 70% of the world’s poor whose main source of income and employment comes from the agricultural sector.

Agricultural Technologies and the Future In her 1991 paper “Beyond Tractors: The History of Technology in American Agriculture,” Deborah Fitzgerald, Professor of the History of Technology in the Program in Science, Technology, and Society (STS) at MIT, argued that the history of agricultural technology is in a very nascent stage of development, and it is difficult to predict the outlines of a more orderly, systematic future. Barely 20 years after her observation, the developments in mobile technology for agriculture have confirmed her argument. Little is known about any prediction of the current growth of mobile technologies, especially in the world’s poorest regions. It is also becoming more difficult to predict what the market will look like in the next decade given the fast pace at which the technology is growing.  

So Why This Sudden Spurt? The 2nd chapter of the World Bank report referenced above titled “Mobilizing the Agricultural Value Chain” has identified a number of factors that are driving the increased adoption of mobile phones for agriculture in the developing nations:

  • Improved accessibility and affordability through expansion of mobile networks.
  • Increased capacity or bandwidth availability on mobile networks as the technology evolves.
  • Increasing data-enabled mobile devices with increasing affordability.
  • Innovative development of remote wireless sensors and identification technologies.
  • Increasing availability of specialized mobile services targeted to specific agricultural functions.

These and other factors, such as wide ownership of mobile phones, instant and convenient service delivery, increasing functions, and falling prices of mobile handsets, will continue to drive its adoption.    

Looking into the Future of Mobile Innovations for Agriculture

Photo Credit: American Public Health Association

According to USAID, innovations must lead to substantial (not incremental) improvements  in addressing development challenges. But this does not seem to be the case in the mobile agricultural sector. The role of mobile agricultural projects in addressing development challenges in the developing nations is yet to be empirically tested in most countries. Anecdotal results have been reported here and there, but there is little to cite about any substantial impact on agriculture and rural development. An interesting trend with the mobile innovations for agriculture pointed out by the report is that, the applications are usually designed locally and for specific target markets, with localized content specific to the languages, crop types, and farming methods. It continues that while these local designs may offer exciting opportunities for local content and applications development, they may also limit the economies of scale realizable from expanding from pilot programs into mass markets, potentially hindering the spread of new and promising applications and services. So while development practitioners are careful not to repeat the traditional “technology transfer” approach in the ICTs for development sector, they are also faced with the limitations of scalability of the locally developed mobile applications for agriculture.  

Is Reverse Innovation a Possible Solution to Limited Scaling of Locally Developed Mobile Apps? The local app development market in the emerging economies is being boosted by the proliferation of Technology Hubs & Parks in these countries. But what are the approaches to development of applications within these hubs? How can we learn from the past challenges with technology transfer and the current scaling limitations of locally developed apps for agriculture? The concept of reverse innovation developed by Vijay Govindarajan, and Chris Trimble and explained in details with practical applications in their book, “Reverse Innovation: Create Far From Home, Win Everywhere”,  could bring these two challenges together. A key component of the concept is about building Local Growth Teams (LGTs). Within the mobile agricultural sector, LGTs comprising of ICT developers, marketing specialists, and content developers in the emerging economies with strong link with global market could be developed. This will ensure that locally developed ICTs apps with inexpensive models and limited infrastructure to meet the needs of developing nations, can be easily repackaged as low-cost innovative goods for Western buyers. This could address the scaling challenge brought up by the report and at the same time limit the traditional diffusion of technologies from the developed to developing nations.  

Oversights: Mobile Solutions for R&D and Data Collection? I would like to recap my recent work on “Mapping ICTs Along the Agricultural Value Chain” for USAID’s Global Broadband and Innovations (GBI) program. Two key components of the value chain, which seem to be overlooked, are ICTs for agricultural research and development (R&D), and ICTs for data collection to inform monitoring and evaluation (M&E). Firstly, mobile technologies for agricultural R&D are emerging, but due to the traditional under-estimation and under-investment in agricultural R&D in developing countries, little attention is being paid to its potential. There is huge potential in the use of mobile technologies to support the work of agricultural researchers, agricultural science students, extension staffs, and farmers to facilitate access to scientific knowledge and exchange of information between and among these actors. Unfortunately, this has been overlooked by this important report. Secondly, mobile technologies are being used along the agricultural value chain for data collection in order to inform policy and decision-making. The report did mention briefly the importance of mobile in agricultural data collection, for example the work of Grameen Foundations Community Knowledge Worker (CKW) program in Uganda and the Reuters Market Light (RML) in India. But in addition to these programs, there are host of new mobile applications that are being used in this area that need to be acknowledged. Examples include iFormBuilder, EpiSurveyor, Open data Kit, among others. These new mobile applications are essential for the work of extension staff – both public and private to facilitate their work. Most importantly, timely and accurate data through these applications will lead to actions that will benefit the smallholder farmer in a number of ways, thereby increasing their productivity.

Conclusion The growth of mobile technologies for agriculture has outpaced the speed of past technological developments within the sector. While the invention of tractors in the 1800’s was acclaimed a significant breakthrough for agriculture, not even the green revolution in the 1900’s can be compared to the extensiveness and intensiveness of mobile technologies for agriculture. The World Bank report reference in this post has done excellent job by carefully selecting experts in the field of ICTs for development to delve into a number of cases worth following. Specifically on the second chapter that deals with mobile technologies and agriculture, I believe practitioners, researchers, technology developers, policy makers, and users of agriculture and mobile technologies should look critically into the recommendations given at the end – business models, ICT skills and the supporting infrastructure to insure the growth and sustenance of the revolution.

Photo Credit: www.dailycontributor.com

Omar, 19 years old and living in an urban slum in India, is an early mobile internet user who repairs mobile phones in his brother‘s store. “This is magic in my palms,” he says valuing the weight of his mobile phone, not only in his hands, but in his day-to-day life. “God knows what I would do without this. I download songs and listen to them all day, I download movies and watch them in the night when I get back home, I play games in between servicing client, I change my internet plans as and when I come across a great one that gives me the most for the least.”

Omar is certainly not the only teenager in his slum who is fascinated with mobile technology. It’s this appreciation for ICT and its various uses for finding comfort — a way of managing and building personal technology infrastructures as an important element in conducting one’s own life — that Microsoft researchers wanted to portray in a new report, Anthropology, Development and ICTs: Slums, Youth and the Mobile Internet in Urban India. The report aimed to bring awareness to the ICT for development (ICT4D) community of the important insights that be gained from anthropological studies within an understanding of what drives a specific user population to adopt technologies in specific ways: even if the latter is only for entertainment purposes.

Researchers observed how twenty underprivileged teenagers living in a slum used ICT in their day-to-day lives by employing a variety of qualitative methods, including open-ended interviews, observations of community life, and semi-structured baseline surveys. They focused their findings on:

1) Investigating everyday entry points for internet use

2) Identifying ways the internet is understood, accessed, used and shared in multiple ways among the user population

3) Qualifying the social paths sustaining the persistence of internet use among teenagers in a constrained infrastructural environment — specifically that of an urban slum.

The report offers a fascinating anthropological view of how ICT could, and perhaps should, be seen by the ICT4D community:

“If constrained technology environments such as urban slums or how youth use ICTs are legitimate interests for ICTD research, such concerns could pave way for a subtle yet vital exchange between the domains of anthropology and development with the aim to expand a utilitarian notion of ICTs and their role in human progress.”

With so much focus being given to ICT for education initiatives, this leads us to wonder: Should technology be introduced into communities where ICT has not yet been adopted? Or is it better that we first observe how technology is already being used, such as use of  mobile phones, and structure our education programs around these pre existing uses? The report suggests the latter and encourages ICT4D developers to consider all of the ways technology is already being used even if it doesn’t have the direct effects that we anticipate or fit a preconceived definition of “development”.

“Indeed, this may require us to broaden our view of how we think about what underlies a good ICTD research project and how we view a range of human behaviors as incremental to development. Rather than using the internet to search for educational material, the youth in our study search for music and Bollywood teasers. These are hardly developmental in any conventional sense, but more akin to behaviors of youth in any part of the globe! No doubt what begins as entertainment can lead to more serious activities.”

The report is certainly a welcome and valuable resource to developers in the ICT4D community.  The full report can be accessed here.

 

Photo Credit: www.popsci.com

If education quality is largely dependent on the teaching capacity of educators, wouldn’t integrating video instruction from expert teachers into low-resource schools’ curricula seem like a good idea?

Digital StudyHall (DSH), a program that has pioneered Facilitated Video Instruction for primary school education in low-resource settings since 2005, might seem revolutionary to the improvement of education quality in theory.  However, a team of researchers from the University of Washington and the StudyHall Educational Foundation recently completed a two-year study in government primary schools in Northern India which concluded that might not be the case.

The Facilitated Video Instruction in Low Resource Schools report detailing the study and research results was presented at the International conference on information and communication technologies and development (ICT4D2012) last Tuesday in Atlanta, and offers valuable insight into the core challenges that prevent the project’s scalability and sustainability, as well as a few lessons that the whole ICT4E sector could benefit from.

Over the course of two years, researchers observed and compared the use of DSH in eleven schools on the outskirts of a large city in the North Indian state of Uttar Pradesh, one of the most populated and least developed provinces in India.  With the approval of the Indian government and while adhering to the national curriculum, the team introduced video recordings of high-performing teachers into low-performing classrooms and conducted quantitative and qualitative studies to measure the impact of this educational intervention.  The team also held technical training seminars for participating teachers and helped establish electrical connections to support the TVs and DVD players.

Setting out, the researchers expected to see positive quantitative results in student competencies and noticeable improvements in the participating teachers’ teaching skills. However, within this cultural context, a number of variables such as student test scores heavily influenced by cheating and a large number of student and teacher absences during harvest seasons, prevented the researchers from collecting reliable quantitative data.

Though the researchers saw positive improvements in some of the participating teachers’ pedagogy during DSH and throughout the rest of their teaching — based primarily on their ability to use the interactive teaching methods displayed by the model teachers in the videos — other teacher’s were not receptive to working with DSH staff and two schools had to drop from the program due to theft of equipment.

So while the report ultimately concludes that the project is not sustainable in this particular context, at least not without substantial support from outside organizations, here’s a few lessons we can take away from this project:

  • Teacher buy-in is essential. The major contributor to successful programs in the study was having at least one motivated staff member who was passionate about teaching, as well as having support from strong school leadership.
  • It is critical that all of the participants — teachers, principals, students — view the educational intervention as valuable relative to available options.  This should help to ensure sustainability and reduce incidents of equipment theft.
  • Photo Credit: Teach for India

    The main obstacle to scalability is the educator’s view of their profession and personal teaching capacity, as well as their commitment to education.  Teachers must value their role as an educator in order to have incentive to continue to grow professionally and use effective teaching strategies.

  • Educational context matters.  The content and format of the lessons should reflect the cultural context in which they are used.  In other words, is it appropriate for the target audience considering what teaching methods they are already familiar with?  In a context like India’s where the teaching profession is respected in the community but is divided between credentialed teachers and paraeducators, what are the impacts of introducing a teaching aid that might undermine the efficacy of a teacher’s previous training and teaching skills?
  • The improvement of the participating teacher’s pedagogy is essential and progress should be continually monitored.  Teachers should show progress in using student-centered teaching methodologies to be considered effective.  For example, do they ask questions and initiate discussion? Do they check for student understanding?
  • Programs of this kind should supplement a teacher’s instruction, not replace it.  A teacher can learn just as much as the students can from educational videos — especially if they have not received the proper training for teaching their assigned subject — but without improving the teacher’s teaching strategies, the project’s overall goal cannot be achieved.
  • Photo Credit: www.mtestsite.com

    Socio-economic issues can indirectly be addressed within video content.  The report notes that the students in the videos were all girls and came from poor, urban backgrounds.  The participating students responded well to their video peers, sometimes interacting with them, like clapping for their video peers who answered a question correctly, small details that can have positive lasting effects. (A recent blog entitled What Sesame Street Can Teach the World Bank by Michael Trucano, offers additional lessons in developing this kind of valuable video content)

The DHS researchers anticipate that as the ICT4D field matures, there will be increasing emphasis on larger evaluation studies.  Until then, facilitated video instruction programs need more program refinement and teacher buy-in to be considered a worthwhile investment.

Photo credit: DIPTENDU DUTTA/AFP/Getty Images

With International Women’s Day this week on March 8th, several prominent aid and research organizations working in the developing world are releasing some fascinating new reports that explore how ICTs and gender impact each other.  Creating a startling picture of the realities of gender disparities within an already gaping digital divide, the reports identify a technical literacy barrier that is hindering development for women at the Base of the Pyramid (BoP), or those living on less than $2 a day.  It’s currently estimated that a woman is 21% less likely to own a mobile phone than a man, and of the large population of women that do not own phones, one report revealed that 22% of them claimed the main reason was that they “wouldn’t know how to use it”.

Termed the “mobile phone gender gap” by mWomen, a GSMA program which aims to reduce it by 50% by 2014, this inequality has recently been examined from several different perspectives: four case studies from India compiled by the Cherie Blair Foundation and International Center for Research on Women (ICRW); a research report that offers a narrative glimpse into the lives of BoP women, framework for designing business models and a set of research tools for conducting studies, all created by the GSMA mWomen Program; and an analysis of the results of several ICT gender focused projects conducted by the Swedish Program for ICT in Developing Regions (Spider).

Photo credit: Kelake.org

1. Connectivity: How Mobile Phones, Computers, and the Internet Can Catalyze Women’s Entrepreneurship

The Cherie Blair Foundation, a charity that supports women entrepreneurs in developing and transition countries, and the International Center for Research on Women (ICRW), an organization which aims to improve gender equality and reduce poverty in the developing world, teamed up to investigate four initiatives to target women and observe how technology is helping them to earn income.  Through in-depth research and analysis, the report focused on the opportunities and challenges involved to reach several important conclusions:

  • Women will utilize ICTs to develop their businesses when the technology is available to them, increasing both efficiency and social status
  • Out of all of the ICTs currently available, mobile phones are the first choice for successful business ventures, with portability and adaptability being the biggest draws
  • Women using ICTs in their businesses promote their benefits amongst friends and family
  • Out of the few thousand women highlighted in the case studies, there’s still a lot of potential — perhaps half a billion women — for new entrepreneurial ICT initiatives in India
  • Partnerships are essential between the public, for-profit, non-profit and social enterprise sectors
  • Sustainability is still a challenge but could be improved with more multi-sectoral partnerships bolstered by the economic and social benefits
  • ICTs are attracting women entrepreneurs for their efficiency and time-saving capabilities though exploring new ways the technology can foster support and communication between women entrepreneurs still needs to be explored

Photo Credit: Reuters

2. Portraits: A Glimpse into the Lives of Base of the Pyramid Women

To provide a snapshot of what life is like for women living on under $2 a day, the GSMA mWomen Programme, a global public-private partnership between the worldwide mobile industry and the international development community including USAID and AusAID, created Portraits, a summarized version of a larger research report entitled Striving and Surviving – Exploring the Lives of Women at the Base of the Pyramid, due to be released on March 8th.  To represent the mass of quantitative data and information collected from one-on-one interviews during the research, the report presents 8 fictionalized life stories from varying regions, each representing a different important aspect of life for BoP women.  Here are just a few of the statistics that can be found in the report:

  • Of the women who did not want to own a mobile phone, 22% said the main reason was that they “wouldn’t know how to use it”
  • 74% of women chose “a good education for my children” as one of their top five life priorities
  • 83% of the women surveyed had not completed secondary education. 31% had no formal education at all
  • 47% of mobile owners said they had been taught to use their handset by their husbands, while 34% had taught themselves
  • Only 6% of the women in the study knew (without being prompted) you could access the Internet through a mobile phone, and less than 2% had done so.  Amongst young BoP women ages 16-21, 39% had some awareness of the mobile web, though only 5% had used it

Photo credit: womendeliver.org

3. Empowering Women Through ICT

Summarizing the outcomes and conclusions from five different projects using various ICT platforms carried out in five countries — Bolivia, Kenya, India, Rwanda, Vietnam, and Bolivia — this report created by the Swedish Program for ICT in Developing Regions (Spider) focuses on how ICTs can support women in the rural regions of the global south.  By observing the impacts of the projects on the lives of each group of women, Spider researchers considered the implications of how technology affects gender just as gender affects technology through:

  • 2 projects in Bolivia: one focusing on empowering female community leaders and one supporting victims of domestic violence through a safe virtual environment
  • A project carried out in both Kenya and India which focused on ecological sustainability, diversification of livelihood, basic training in ICT through self-help groups
  • A project in Rwanda which explored the use of ICT in small business development through a women’s basket weaving initiative
  • A research project in Vietnam which considered gender in the development of ICT.

 

Photo Credit: Climate EduXchange

 

How should we engage youth in discussing climate change and how it affects our lives? Climate EduXchange, a partnership between TERI (The Energy and Resources Institute) and Dell Inc, wishes to do just that in India.

TERI has for a long time been involved in educating youth on environmental issues through its Youth Education and Action Group that has “been working with educational institutions to sensitize students to the environment, inculcate the right values and attitudes about the environment in them, and help them grow as responsible citizens of the world.” TERI chose India for implementing this project because of its great geographical and climatic diversity that is impacted in varying ways throughout all sectors of life.

Climate EduXchange reaches out to students, teachers and the community on the key issue of climate change through information and communication technology by providing a platform (interactive project website) for “students from identified parts of the country to share information and ideas across disciplines – about how climate change is affecting them, and how India might best secure a path towards sustainable development.” The project is time-bound, with a structured methodology for rolling out the program in each city. Climate EduXchange is currently taking place in Shimla, Jaipur, Mumbai, Puducherry, Medak, Mysore, Bangalore, Delhi, Hyderabad, Chennai, Mohali, and Prune.

On the website there are useful lesson plans, radio broadcasts, and videos that can be used in the classroom. Through this platform students have the opportunity to improve  upon their technical skills by managing webpages and forums using the computers and Internet facilities provided. Climate EduXchange has spawned new activities including project resources, student exchange, competitions, outreach, and workshops.

Green Prakriya, a joint initiative of Digital Empowerment Foundation and Association for Progressive Communication, was formed to address India’s “tremendous economic growth owing to the influx of the information and communication technology revolution.” With this advancement, a wave of e-waste ensues. The initiative works as an eco-web platform that acts as a green ICT knowledge base for practitioners, policy advocates, policy makers, researchers, professionals and the masses interested in environmental sustainability, networking, coordination, and implementation.

 

Green Prakriya’s philosophy is:

  • to engage stakeholders working on green technology
  • to develop a network of stakeholders working on Green technology
  • to create a rich knowledge base of technology solutions for addressing environment issues
  • to conduct awareness and outreach programs through seminars and workshops
  • to develop a collaboration amongst scholars and practitioners nationally and internationally
  • to act as a policy advocate
  • to act as an intermediary or medium to promote e-waste management in the city

Green Prakriya strives to bridge the gap of a lack of information and communication of stakeholders aware of the issues of technology waste. The initiative has taken part in mapping exercises and workshops to raise awareness.

 

Mobile Phone and Cash

Photo Credit: TechCentral

Within the last month, there have been multiple new examples of mobile phones being leveraged to expand financial services in developing nations. With the popularity and quick success of M-PESA in Kenya, there was a push to copy the model in other developing countries. But it has been realized that the M-PESA model cannot be simply duplicated. The new mobile money products and services need to focus on solving a customer’s pain (or perceived pain) within the regional context (competition, policy environment, culture, infrastructure, etc). The examples below show how innovation in the market is occurring to meet the needs of customers. Mobile Network Operators (MNOs) are seeing the benefits of providing an expanded set of value-added services to differentiate themselves in the market. In a recent TECHTalk  at USAID with Pamela Riley from Abt Associates, she explained that MNOs are most focused on increasing and keeping their customers. With greater competition in the mobile network market, the ability to create more value to a MNO’s service keeps the customers from jumping from one provider to another (usually easier because one MNO’s SIM card can be easily switched out for another’s). The MNOs’ desire to increase revenue creates an incentive for them to implement innovative solutions based on the needs of their customers but also within the region’s entire context.

Below are a few recent examples of innovation in the mobile money space:

 

Mobile Banking

RedCloud Technology recently completed Bolivia’s first mobile money platform. The product, Nube Roja, was created from a $1.2 million investment from BlueOrchard, CONFIE (Corporación de Fomento a Iniciativas Económicas S.L.), PROFIN (Fundación para el Desarrollo Productivo y Financiero), Iceni Mobile, and RedCloud. The goal of the product is to provide access to financial services to roughly 6.5 million people in Bolivia who do not have a bank account. A pilot of the service will begin in the near future with customers being able to cash in, cash out, top up their airtime, transfer money person-to-person, and send remittances.

A newly formed partnership between First National Bank (FNB) and retail store PEP allows customers in South Africa to use FNB’s eWallet for banking services at the retail store. As long as the individual has a bar-coded South African ID, he/she can deposit, withdraw, send, make payments, and purchase goods at any PEP store in South Africa. In the past, only FNB customers could use the product. But with this partnership, FNB is looking to reach the unbanked in the country. Partnering with PEP expands FNB financial services to 1,200 stores and gives greater access to those who have a mobile phone.

As a part of a strategy to expand financial services further into the rural areas of Mexico, the National Savings Bank and Financial Services (Bansefi) is going to use mobile technologies through the implementation of the Program of Technical Assistance to Rural Microfinance (Patmir). Their goal is to have over 15% of their new partners and customers be served with low-cost mobile technology. Bansefi will be hiring a consulting firm to provide technical assistance with the implementation of new technologies, innovations, and best practices.

 

Money Transfer Services

In partnership with one of the leading MNOs in India (BSNL), the Indian Post Office has begun its own mobile money service.  The service allows money be transferred via text message and utilizes the physical post offices to act as cash in/cash out locations. It works by the sender providing the post office with the receiver’s information (number and address) along with the amount to be sent. Once the cash is deposited, both the sender and receiver are text messaged a unique code by the Post Office. In order to withdraw the money, the receiver shows the code to the Post Office.  There is a service charge of 5% and is available to individuals across all networks.

Airtel has plans to establish mobile money transfer services in Kenya and Tanzania as it has already done in Uganda. The goal of the new services, as stated by Michael Okwiri, Vice President of Corporate Communivation at Airtel Africa, is eventually create a cross-border money transfer service between the three countries.

Western Union and Telma, a Malagasy telecomm company, have partnered to start an international mobile money transfer service. The new service allows citizens to transfer money via their mobile phones by using Western Union’s international transfer service. By combining Telma’s mobile money service (MVola) and Western Union’s service, individuals can receive money transfers from abroad via their mobile phone. The transfer will go directly into their MVola account. At this point, it is only a one-way service as Malagasy citizens can not send transfers outside the country. MVola, like other mobile money services, allows customers to purchase goods, make payments, and deposit/withdraw money.

 

ATM

As a part of Airtel’s new mobile money platform in Uganda, customers will be able to process transactions at ATMs. This includes paying bills, accessing their bank accounts, and withdrawing Airtel money using ATMs located country-wide. This service was made possible via partnerships with banks which include Standard Chartered, Post Bank, KCB, and Diamond Trust Centenary Bank.

 

Credit-Worthiness

A Cambridge start-up has created software in order to help determine an individual’s credit risk by looking at how the person uses their mobile phone. Cignifi has received $2 million in funding after piloting the product last year in Brazil. The software looks at multiple data points in order to further understand one’s lifestyle. It creates a score similar to the FICO score used in the United States. Since many developing countries do not have credit bureaus or limited ones, it is more difficult to calculate the credit risk of an individual person. This is innovative way to understand the riskiness of an potential borrower.

 

Photo Credit: Intuit Fasal

Over 500 000 rural farmers in India can now access free daily market information and weather services on their cell phones with the help of Intuit Fasal platform, an SMS based mobile service.

Fasal begun as an experiment after it was recognized that rural farmers in Karnataka, India lack price information in relevant multiple markets; have issues with price transparency in markets; and also lack knowledge of potential buyers of their farm produce.

After a period of interaction between some company executives and the farmers in their rural setting, it was identified that the above challenges lead to information gaps that have a huge impact on the livelihood of the farmers and their families who often look at existing means of livelihood as one that does not provide sufficient returns.

The opportunity to provide a service where actionable information on price, potential buyer, weather, etc. would be invaluable to farming communities while also helping bridge the gap for large organizations to reach out with relevant offerings and advisory services in India was irresistible and therein was born Fasal.

Fasal has a single objective of helping farmers make more money or save more money! And this is being achieved through a business model that ensures that Fasal is a free for the farmer while companies providing household items to these rural communities, consumer durables, automotive equipments, agriculture implement and inputs, financial service, consumer goods, and other advertisers are rather charged for the service.

How it Works

Step One: A farmer calls toll free number in their respective local languages to register for Fasal. The farmer is then profiled by the staffs of Fasal based on information such as the commodity s/he grows, current crop season, land size under cultivation, etc. The farmer’s profile is then mapped to the markets that s/he visits to sell his or her produce.

Step Two: Based on this highly personalized information of each farmer, regular market and weather information are sent in their preferred local language at a time that it is most actionable. Additional relevant messaging is also sent on the basis of farmers’ profile such as use of irrigation facilities or ownership of farm equipments, etc.

Step Three: Using a complex and patented matching algorithms, Fasal service connects farmers to potential buyers/agents/institutions who would like to connect directly with farmers and make a purchase – creating an engaged and busy marketplace. The service using complex matching algorithms ensures that the multiple service messages reach the farmer every day, providing him/her data so that s/he can make informed decisions.

Impact

Even though the service is still at its infancy, its social and economic impact on the rural communities is being closely monitored, including the use of independent third-party research. According to Fasal, the vast majority of Fasal customers in Andhra Pradesh and Gujarat found the service useful and it is helping them earn an average of 20% more with the service.

For more information, visit Fasal site and also read this interesting article about the innovation.

Photo Credit: David Fletcher

NB: This is my personal analysis of contributions to question three from the forum. This post is the third in series of six, analyzing each of the six forum questions that were discussed.

Following the first two discussions on partnerships and scale, the third discussion was based on justifying a business case for investing in mobile agricultural services for rural poor farmers and the motivations for the service providers.

 

Question 3: Is there a business case for serving poor rural smallholders and what are the motivations for the Mobile Network Operators (MNOs) and Agricultural Partners (APs)?

Understanding the term “Business Case” for the Discussion!

As the discussion begun, a question was asked to clarify the term “business case.” In response, the facilitators pointed out that “Business Case” for the purpose of the discussion refers to “service models that meet specific needs (that of the customer/user) and are ultimately financially viable.”

Justifying a business case for serving poor rural smallholders with mobile agricultural services that meet their needs and at the same time financially viable, may involve identifying factors that currently contribute to their information deficit or information gap. It also involves proving that investment of capital and other resources are justifiable over time such that the benefits, costs and risks balance out to create this commercially viable service for both users (farmers), and service providers (MNOs and APs).

A Business Case for Serving Poor Rural Smallholders with Mobile Agricultural Services

The first contribution to the question from one of the experts used the case of Indian smallholder farmers as a typical example in the developing world, which shows the current deplorable state of smallholder agriculture. Some of the reasons due to low agricultural productivity include dearth of physical infrastructure, deficiency in the availability of agricultural inputs and lack of, or uneven access to information. Small and marginal farmers are often unable to gain access to reliable information that could help them increase their farm yield and get better price for their crops.

In earning their livelihood, small farmers face innumerable hurdles such as small acreages with low yields and low profit margins; less access to irrigation; susceptible to problems like crop diseases; scattered geographically; difficulty in pulling resources to accessing the latest information on growing techniques and the market; lacking access to credit to buy inputs; borrowing at exorbitant interest rates; forced to buy inputs at high costs and of poor quality from the money lenders’ shops; exposed to high risk; not being aware of agricultural insurance; facing shortage and high cost of labor; lacking facilities to store their crops; disorganized market; lack of efficient procurement system for their crops; and being compelled to sell their crops to brokers.

This array of problems and challenges facing smallholder farmers in the developing world, justifies serving them with mobile agricultural services. Access to mobile agricultural services is expected to increase the farmers access to credit, information on farming techniques, procurement of inputs as well as marketing their goods directly to customers or commodity exchanges.

Business Case for Service Providers

Looking at the specific needs of the rural poor farmers (users) who are at the bottom of the pyramid in the developing world, providing affordable and financially viable mobile services could be challenging. So the issue was whether it was the duty of the private sector or the national governments to meet these needs.

An interesting argument from one of the discussants was that serving rural poor and rural smallholders often is the duty of national governments to come up with certain schemes and programs. However, governments have limited resources and priorities, and it is a challenge to address the information needs, when other basic social needs are yet to be fulfilled. Sharing experiences from Bangladesh, the contributor stated that governments today are looking at alternate models like Build, Own Operate (BOO), Build, Own, Operate, Transfer (BOOT), Private Public Partnership (PPP), and outsourcing of non sovereign functions.

The partnership eco-system is also another dimension that needs to be looked into and nurtured and this is where government and MNOs can work together to deliver value to customers in rural areas. The bottom line is that there is a compelling business case today for MNOs and governments to work together to jump start the process and explore alternative business models that are sustainable in the long run.

Motivations for MNOs to Serve Rural Poor Farmers

The general view from the discussion also shows that, making a business case for MNOs is about whether the service is serving the rural poor to increase market share and revenues in the short or longer run. The MNOs, according to the discussion also may have two distinctly different views on how serving the rural poor will increase their market share. These are:

i) Provision of mobile agricultural services as a stand-alone business that should generate revenue for the company through direct revenue from charging per customer,

ii) Provision of services intended to boost revenue in the company’s core business or through indirect revenue benefits from acquiring and/or keeping customers loyal and active on their network such as selling SIM cards, air time, ring tones or launching mobile money services, etc.

If MNO looks primarily from a financial viability alone, there would not be any business case in providing services to rural areas. But when the business case is looked from a holistic view, then the whole paradigm of business case changes. In this case the Mobile Network Operators (MNOs) are motivated to take up a number of m-services via mobile networks such as financial services like mobile payment and banking, financial literacy; health services including health education clinical care, health worker training; mobile-based learning and education; market information services including farmer information services and help-lines, market pricing information and transportation.

Another view is that, scale is critical for MNOs to reach commercial viability and currently there is a business case for only a few mobile solutions serving farmers as it is not easy to reach the right income-costs balance and achieve service self-sustainability. It was noted that the private service provider will not venture into rural areas, which do not have economy of scale.

Commercial Services Versus Social Enterprise

There was also another concern about the service provision in terms of commercial services (services targeted at making profit) and services developed by social enterprises or social entrepreneurs (where the focus is improving people lives in a way that does not rely on donor funding). The questioner believed that this is often the tension between APs focusing usually on the social impact, and the MNOs, focusing on the commercial aspect.

Motivation for AP’s (Social Enterprise)

Providing mobile agricultural services from social enterprise perspective was seen as complicated because it usually includes some measure of the public good. But this approach depends on the willingness of donors to help out with up-front investments. Defining and honing these investments is critical, said by an expert.  The mFarmer Initiative is focusing on doing this with its Challenge Fund as well as its learning component and technical assistance.

Another concern with the social enterprise approach is the long-term financial sustainability of the service after a potential start-up funding runs out.

In summary, the discussion brought out the proof for a business case for MNOs and APs to partner and invest in mobile agricultural services that could serve rural poor farmers and increase their access to agricultural information. Such investments will invariably improve lives in these rural communities but it was also necessary to ensure the financial viability of such services for the MNOs and APs. It was noted that the commercial viability and social impact of such a service are often closely related. Ensuring that the farmer use the service and act on the information received, is a long-term driver of repeated usage.

NB: The Next in the series (4th) is “Reflections on mAg Services: Financial Sustainability” (Available on 12/31/2011)

The first and second posts are:

1. “Reflections on mAg. Services: Partnerships Between MNOs and APs

2. “Reflections on mAg. Services: Barriers to Scale

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