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Mobile Money Service: An Innovation for Rural Women

Photo Credit: Africa News

I remember vividly carrying bundles of millions of Cedis (Ghanaian Currency) in my car about 9-10 years ago, and driving from Tamale (the Regional Capital) to the remote rural communities to pay local farmers for their seed cotton during marketing. You can imagine all the risks involved in carrying such a huge sum of money across districts with no security – the danger of being attacked by armed robbers, the chance of loosing the money, the risk involved in counting and paying individual farmers accordingly without over or under-payment, the challenge with safe handling of these money by the local farmers themselves, the temptation of overspending the money by the rural farmers immediately after receiving their payments, and the risk associated with “banking” the money in their thatched houses.

Don’t forget about my earlier view of a typical ‘rural’ community – lack of basic social facilities such as credit union or banks. I saw my own mother ‘banking’ her money in some special plastic bags and hiding it from us (the children) and later discovering that the value of the money has depreciated such that she could not use it – don’t forget about the skyrocketing inflation rates in Ghana in the mid-late 80’ after the military coup. I also remember interesting stories of my cotton farmers about ‘banking’ their money in the home under mattresses and being discovered by their children; hidden in a pots and being destroyed by red ants and other insects; buried in the ground and forgotten or swept away by a flood; kept under the roof of their building and being destroyed by fire, among others.

Basically, rural women who are mainly farmers, have the challenge of banking or storing the money they obtain at the end of the farming season safely and inaccessible from others as well as from themselves. These rural women also at some point of their life, need to either send some of this income to their relatives outside their village or receive money from their children in the cities. This ability of transferring money to others, or location-shift one’s own money is also an issue. It is also important for the rural women to have sufficient money (or credit) available in the right format or currency when it is required, especially at the start of a new farming season or the beginning of school year where they have to spend on their kids. Finally, the challenge of actually making saving for future use and for purchases of more expensive farm equipments cannot be ignored.

How did the story change with Mobile Money Services?

Mobile money service is seen as one of the world’s fastest growing industries, following the success of the growth of the ‘mobile’ industry over the past two decades where billions of transactions are done using mobile devices. With leadership from M-PESA in Kenya, innovative mobile payment solutions that enable customers to complete simple financial transactions including person-to-person money transfer have been emerging and transforming rural lives. Mobile money services has its presence already in Ghana, Ivory Coast, Benin, Cameroon, Guinea Bissau, Swaziland, Uganda, Zimbabwe, South Africa in addition to Kenya with Liberia being one of the newest countries across Africa to adopt this innovation.

Rural women all over the world are now using mobile money services to facilitate their work. When asked about the mobile money service being provided to her by Lonestar Cell MTN and Ecobank Liberia Limited, a market woman has this to say:

“In trying out the Mobile Money service, I have been able to send money to my son in Buchanan to pay his fees at the Grand Bassa Community College where he is a student and not worry whether the money I sent would reach him. I found the service very effective, convenient and affordable. Clearly, this is better than any other money transfer service I have ever used” (Woman from Liberian Rural Community).

Within the mobile health sector, the application of mobile money service is seen in the use of Medical Smart Cards that allow people who have no access to medical plans or insurance cover to save money through the use of M-PESA transfers. Savings are used to pay for primary health care, specified laboratory tests and drugs at pre-contracted prices. A combination of mobile banking, public information, and free treatment are used in Kenya to give women access to fistula repair. Women can call a free hotline, and if money is needed for transport to a fistula unit this is transferred via M-PESA. Using mobile money services make treatment a reality for women who otherwise would not have been in the socio-economic position to get an operation.

A study conducted on the use of mobile money services in “Kenya Case Study: Who Is Using Mobile Money?” shows that slightly more than half of the mobile money market (56%) live in rural areas and 51% of the users of mobile money services are women. Another study conducted in Kenya in 2009 about the impact of mobile money on the rural people revealed that M-PESA is boosting their income through cheaper, more accessible, and safer money transfer options. The research also shows M-PESA is empowering rural women because it makes it easier for them to solicit and receive money from their husbands and other contacts in Kenyan cities. Remittances through M-PESA relieve many women in rural areas of the burden of traveling by bus to cities to receive money from their husbands, a process that for some could take as long as one week. Also the M-PESA mobile money transfer system is used in Tanzania for example to pay for the transport of women suffering from fistula, children with cleft palates and other disabilities.

The potential of mobile money in the Ghanaian market is so huge with an estimated 80% of Ghanaian being “unbanked” – meaning they conduct their transactions outside the banking sector with no access to financial services. Mobile money is reducing the transaction costs of financial services for Ghanaian in rural areas, saving the cost of travel and time spent visiting the nearest town to access financial services, providing people with a way to transfer money safely and keep (or even increase) their savings.

The Bill and Melinda Gates Foundation and the USAID-funded project in Haiti, Integrated Finance for Value Chains and Enterprises (HIFIVE) announced the launch of the Haiti Mobile Money Initiative (HMMI) to stimulate the development of mobile money services in Haiti in 2010. The following two stories show the outcome of this project:

In a cybercafé in downtown Port-au-Prince, Jean Yves deposits money into his TchoTcho Mobile account. Michel, his brother who owns the business, recommended that he register for this mobile money service so that he doesn’t have to carry money across town and risk being robbed. Taking his brother’s ad-vice, Jean Yves deposits cash at the cybercafé and withdraws it via his phone when he arrives at his final destination.

One hour away in the busy port town of Saint Marc, Carmen receives a text message saying that Mercy Corps has deposited US$40 of food aid into her T-Cash account. She picks up her bag and heads off to her local merchant to purchase rice and beans using her phone.

The USAID’s Fostering Agriculture Competitiveness Employing Information Communication Technologies (FACET) project which helps USAID missions and their implementing partners in sub-Saharan Africa to use information and communications technology (ICT) more successfully — via sustainable and scalable approaches — to improve the impact of their agriculture related development projects including Feed the Future projects, shares its experience with the use of mobile money in agriculture in “Using Mobile Money, Mobile Banking to Enhance Agriculture in Africa”. Also with the setting up of the mFarmer Initiative Fund, there is the hope that more rural women will have access to mobile phones and be able to utilize mobile money services to improve their lives.

A recent report “Mobile Money Transfers & Remittances: Markets, Forecasts & Vendor Strategies 2011-2015” by Juniper Research predicts active users of mobile money services to double in the next two years, exceeding 200 million worldwide by 2013. The principle behind mobile services including mobile phones and mobile banking with the structural support from information communication technologies is something that has come to change lives in rural communities in particular. Mobile money services have come to stay. Different models, applications, and innovations will evolve over the years for simplicity, ease of use, less costly, and more compatible to a variety of mobile devices across the developing world.

October 14, 2011/by actualize

Agriculture, Mobile, Originally posted on the GBI Portal

Innovating in Afghanistan

The following post was written by Rajiv Shah and appeared in the USAID Impact Blog.

In 2002, fewer than 200,000 people in Afghanistan had access to telephones. Today, some 15 million Afghans use mobile phones and a full 85% of the population lives within the combined network coverage of the four major telcos. This technological leap connects Afghans to each other and to the economy in ways that were unimaginable just a few years ago. And the mobile phone now opens up a world of possibilities for finding solutions to some of the challenges that Afghans face every day. One important use that is quickly becoming a reality in Afghanistan is the creation of a nationwide mobile financial services sector – using mobile phones to transfer money safely and instantly, reducing the need for cash and giving millions of Afghans who may never see the inside of a bank the ability to use their handsets to conduct basic financial transactions. The possible applications for mobile money in Afghanistan are limited only by our imaginations.

USAID Administrator Dr. Rajiv Shah and Afghanistan’s Minister of Communications and Information Technology Amirzai Sangin test a mobile money application at the ceremony in Kabul. Photo Credit: Barat Ali Batoor/US Embassy

Today I had the honor of announcing three USAID innovation grants, totaling just over $2M, to develop applications in this field and begin to create a mobile banking system that could include all Afghans.

At the grant kick-off event, the Afghan Education Minister highlighted the urgent need for mobile payments in Afghanistan by telling us about his staff member who was killed just three weeks ago while transporting cash in a remote province in northern Afghanistan in order to pay a teacher. He expressed his frustration that thousands of his teachers, who are so critical to Afghanistan’s future, often wait months to get their salaries due to the difficulties of transporting cash in the country. I am delighted that USAID is able to help seed a partnership between the Afghan Education Ministry and the mobile operator MTN to begin paying teachers in ten provinces over the mobile platform, thus ensuring they get paid in time and in time, and more importantly, that no Ministry employee loses his life for a duffle bag of cash. And if successful, we expect much of the Afghan civil service to eventually benefit from a mobile payments system that will help the government develop its own capacity as our troops transition home.

The second grant links up telco Etisalat with the new Afghan electricity utility. To my mind, this partnership to design mobile phone-based billing and payment systems for electricity service represents the true art of development by using creative, commercially viable systems to help the Afghan utility collect real revenue. At the end of the day, delivering electricity to all Afghans will require a revenue model that will sustain operations, motivate more public and private investment, and expand Afghanistan’s energy grid so that fewer communities live in the dark. This novel concept applies to any kind of service. In Kenya, some rural communities are sustaining water systems thanks to a mobile phone-based payment system. The concept is simple: consumers use a phone-based app to pay for the water they need, enabling the maintenance required to actually keep the system up and running. Although mobile payments are a simple concept, the possibilities they offer are revolutionary for truly under-served communities.

The third grant funds a partnership between Afghanistan’s mobile money trailblazer, Roshan, and a micro finance consortium whose clients are predominantly women. The concept is to further extend the reach of credit into areas otherwise inaccessible or simply too costly to reach. Running loan extensions and repayments over mobile phones significantly reduces the need for loan officers and clients to travel. This cost savings can be passed on to the customers, making credit more affordable. In culturally conservative Afghanistan, our hope is that this innovation will better serve women who might otherwise not be able to participate in loan programs.

Finally, today we kicked off a contest USAID is co-sponsoring with the Afghan Mobile Money Operators Association to tap the minds of creative young Afghans. University students are being asked to submit ideas for mobile money applications they believe will make a difference in the life of Afghans. Designers of the eight most interesting proposals will receive cash awards and, more importantly, the mobile operators will implement and market the winning apps. We hope this contest will not only drive uptake among a key early adopter demographic, but will also unleash the creativity of young Afghans who have so readily adopted cell phone technology.

With 3G looming just over the horizon (the Afghan Government issued the first tender earlier this month), it is clear that Afghans will increasingly use mobile phones and other modern technologies to build a healthier, better educated and more prosperous society. The days of land-lines or coal-fired development are rapidly being replaced with these new innovations, and I am proud that USAID is able to help unleash Afghan innovation to lead the way.

PS – Check out this video on Afghanistan’s emerging mobile money sector.

August 24, 2011/by actualize

Agriculture, Mobile, Originally posted on the GBI Portal

Mobile Money Donations for Drought Victims in East Africa

Photo credit: Mobile Money for the Unbanked

The vast arid plains of northern Kenya, central Somalia and eastern Ethiopia are suffering one of the worst droughts seen in recent times. Rain has not fallen in some of these areas for over a year and this has gradually resulted in a full blown humanitarian crisis. According to UNICEF, in some areas of northern Kenya, close to 40% of the population needs emergency feeding. In other parts of the affected regions, these numbers are reaching approximately 30%, twice the 15% emergency threshold. As in many crises, the worse affected are children. In a country like Somalia with a population of 3.7 million, this famine could be taking the lives of 1,200 children, with over 2.5 million children estimated to be acutely malnourished and in need of immediate life-saving help. Soaring food prices and the on-going conflict in the horn of Africa has only increased the intensity of the famine.

A massive fundraising effort has been initiated by ‘Kenyans for Kenyan’, a non-profit organization which aims to raise sh500 million in four weeks towards famine relief efforts. This initiative is a joint effort between various businesses including Safaricom, Kenya Commercial Bank (KCB), and the Daily Nation newspaper. During the first 24 hours of the launch of the appeal, the initiative raised over sh 13 million via M-PESA. A number that keeps growing now that Airtel Money and Yu Cash have been added to the list of mobile money options Kenyans can use to donate funds. This campaign’s success not only highlights the efficiency of a mobile money platform in distributing funds in times of need, but it also serves as a lesson for charities and development agencies of the value of leveraging mobile technology and social networking in fundraising and disbursal. At the time of writing, the latest mobile money donations exceed sh 208 million..

If you live in Kenya, please consider donating to the Famine Fundraising Campaign. The funds raised by Kenyans for Kenya will be administered by the Kenya Red Cross Society to help people worst affected by the drought. Follow the steps below on your mobile money menus:

Donating via M-Pesa

Select Pay Bill from the M-Pesa menu
Enter business number 111111
Enter account number 111111
Enter the amount you wish to donate
Enter your M-Pesa PIN
Confirm details are correct and press OK

Donating via Airtel Money

Select Send Money from the Airtel Money menu
Enter ‘redcross’ as the nickname
Enter the amount you wish to donate
Enter your Airtel Money PIN
Confirm details are correct and press OK

Donating via YuCash

Go to the yuCash Menu on your phone and select ‘Send Money’
Enter the Business Bill Payment No. (Short Code) ’200140′
Enter the Amount you wish to donate
Enter your Donation Instruction in the Message field – ‘Leave Blank’
View the Bill Payment Confirmation screen and verify all details. Press OK to continue.
Enter your yuCash PIN and press ‘OK’
Receive Transaction Acknowledgement via SMS

Alternatively, if you are outside of the region, you can donate online via the Kenyan Red Cross or UNICEF.

August 16, 2011/by actualize

Agriculture, Extension Service, Mobile Money, Originally posted on the GBI Portal

Rural Youth in Kenya, and the Impact of ICTs

We would be missing the full significance of ICTs if we do not see them as an integral part in the efforts to improve the everyday life of rural folk in Kenya. Mobile technology being the key mode of communication in the country has contributed greatly to local youth livelihoods. Using mobile phones, the youth have able to access knowledge and information which are vital aspects for improving agricultural development by increasing agricultural yields and marketing.

With accessibility of mobile phone networks throughout the country, services such as Safaricom’s mobile money transfer (M-Pesa), mobile money banking (M Kesho) and information on agricultural produce markets have created job opportunities for the youth as the number of agents increase.

Kamau a young Kenyan in his late twenties from a farming community in Nakuru who approached Equity Bank in 2007 for a loan to set up an M-Pesa shop is an example. As well as farmers and traders were enabled to deposit or withdraw money using their mobile phones, Kamau was able to pay back his start-up loan in just six instalments. “This is to bring financial services to a place where people lack them” he explains.

By simplifying money access, members of the community have more money at their disposal and therefore are more likely to spend it locally. The service has also enabled farmers and traders to purchase inputs and make orders with their suppliers without having to travel into town. The savings made on transport costs enable them to acquire more stock, which means that the entire community benefits from more goods being available locally.

Kamau’s business has also benefitted from transactions made by the farm owners residing in a nearby Nakuru town, who do not have to commute to the village to pay their casual labourers. These farm owners are also able to pay their faming supervisors for land preparation and purchase of fertilisers and seeds.

In 2008, the entire region of Nakuru experienced a severe drought, which led to widespread crop failure, and Kamau noticed an increased flow of money through his business due to remittances from relatives in urban areas. “This service has strengthened friendships and social interactions in the community,” Kamau says. “Moreover, this has greatly contributed to the success of my business. This means that the entire community benefits from the goods available.”

With the revenue generated by his M-Pesa business, Kamau has diversified into farming, now leasing 20 acres of land. He also receives information about husbandry practices from the Organic Farmer e-bulletin, published by the International Centre for Insects, Pests and Ecology (ICIPE), through his data-enabled mobile phone, helping him to grow maize, beans and potatoes.

The subscribed SMS-based ‘411 Get It’ alerts service, a joint venture between Safaricom and the Kenya Agricultural Commodity Exchange (KACE), also provides Kamau with information on agricultural produce and market prices, enabling him to identify favourable markets and cut out middle men. With the profits from his farm, Kamau opened an M-Kesho business, allowing community members to make deposits from their M-Pesa accounts into an Equity Bank account where they earn interest. “This is an incentive for rural youths to engage in farming,” Kamau adds.

During the planting and weeding season, Kamau’s operating capital is reduced as his customers increase their M-Pesa withdrawals. To counter this problem, Kamau took out another loan from Equity Bank to purchase a motorcycle so that he could travel to Nakuru town quickly to top up his M-Pesa account. As a result, he has a steady flow of cash in order to facilitate local business transactions.

Regardless of an increasing range of information services available through the internet, literacy remains a stumbling block for many people because these services are only supplied in official languages. The technologies therefore need to be adapted in such a way as to be accessible in a variety of local dialects to help farmers have easy access to modern farming information and technologies, especially to battle hunger despite dry spells. Access to ICT services would also help to foster local skill building and knowledge sharing between rural communities.

Kamau’s experiences and business understanding clearly show the important linkages and synergies that exist between the development of ICTs and information sharing that can support the livelihoods of a large cross-section of youth and other members of communities for agricultural and rural development.

By Chris Mwangi – I am affiliated to Agriculture, Rural and Youth in the Information society (CTA-ARDYIS Project). Its function is to raise youth awareness and capacity on agricultural and rural development issues in ACP countries through ICTs

August 12, 2011/by actualize

Agriculture, Mobile, Originally posted on the GBI Portal

Embrace mMoney, cautiously

Photo: Institute for Money, Technology, and Financial Inclusion

We all use money everyday. Cash, checks, credit, debit… mobile? Outside of the U.S. people are making payments on their mobile phones daily. What you wouldn’t guess is how ingenious they are at inventing new ways of using money. What do the innovative uses of money mean for banks, regulators, and nations? Does mobile money restructure the role of money in society altogether?

Bill Maurer, from University of California-Irvine’s Institute for Money, Technology, and Financial Inclusion, spoke at a USAID sponsored Microlinks event yesterday, July 25, 2011. I attended the event and was intrigued by Maurer’s anthropological approach to mobile money, a subject dominated by economists. Maurer emphasized the cultural complexities of money in all its forms, and then spoke especially about mobile money.

To summarize, Maurer first explained that money is perceived differently in different cultures of the world. In Nigeria, family members engage in money spraying, tossing money at brides during the wedding dance. In East Asia, mothers send their children on long trips with money inside of small hand sown pockets, believing that the money will protect them, and that they can use it to get settled once they arrive.

Photo: Institute for Money, Technology, and Financial Inclusion

The various uses of mobile money are equally diverse. For one, those who make mobile money transfers using SMS technology skip traditional banks altogether, as their telecommunication service providers act also as banks. Second, what about people who own multiple mobile phones or SIM cards in order to maintain different accounts? Some hide certain accounts from others; others separate the accounts for organization. Third, there are some cross-border money transfers. Often, if the service provider is the same, then the transfer may be made. Fourth, there is a possibility of mobile money remittances, as Ericsson launched two weeks ago? Still others trade their money from one currency to another to another, eventually “getting to the dollar,” and ensuring the value of their money. All of these actions change relationships between banks, individuals, government regulators, and telecommunication service providers.

Photo: Institute for Money, Technology, and Financial Inclusion

In a way, the elimination of banks from money transfers makes it appear that transfers should be a “public good,” freely and widely available. The policy implications for regulators, then, are immense. Who can take a cut of transaction costs? What rules should be in place about currency transfers? How are regulatory agencies from different nations going to communicate with each other? These questions, with a host of others, set the stage for mobile money’s impact on the global economy.

Though I was thoroughly engaged by Maurer’s presentation, I could not help but wonder what the policy implications were. When Maurer responded to one attendee request for a summary of the lessons learned about mobile money, he originally responded, “I have shied away from the lessons learned because I am open as to what they may be.” Thankfully, though, he followed up this response with three key regulatory innovations that he recommended for policymakers: proportionate due diligence, non-bank e-money issuance, and non-bank deposit taking.

USAID and other international organizations, then, should be careful in their rollout of mobile money projects. Though over 80% of the world has access to a mobile phone, the impacts of mobile money programs are far-reaching—they affect the financial, political, and social sectors, either for the better or the worse. If nothing else, the anthropological research by Maurer shows the complexities of mobile money. Before a list of best practices and lessons learned can be compiled, policymakers should tread carefully, but they should still step forward. As evidence and data is gathered through experiments, best practices can be ascertained. Once best practices are identified, then USAID and other aid organizations should scale mobile-based development projects.

July 27, 2011/by actualize

Agriculture, Agriculture Markets, Extension Service, Food Security, Forestry, Irrigation and Water, Livestock, Originally posted on the GBI Portal

South Sudan: In search of a food policy?

Credit: Farm Africa

After two decades of civil war and amid a tense truce, the world recently welcomed its newest nation, The Republic of South Sudan. But like many of its Sub-Saharan neighbors did 50 years ago, South Sudan joins the rank of nationhood with a raft of intractable developmental challenges– and the high expectations of 8 million people adds importance to each.

While the slate of challenges at hand are all important for sustained socio-economic development, achieving national food security will be key to the success of the nation. It is a vital part of national security and nationhood. But achieving self-sufficiency in food production and food security will require full transformation of the embryonic nation’s agricultural sector.

Although the sector accounts for the majority of economic activity—33% of the rural population lives on agriculture, whereas 45 % and 12 % are agro-pastoralists and fishermen respectively—the industry is stuck in a pre-industrial form. This is particularly bothersome as new nations must effectively manage their citizens’ expectations–for basic services, jobs and food–to thrive.

However, the country has been unable to provide enough food for the people of South Sudan since the signing of the Comprehensive Peace Agreement (CPA) in 2005. More than a fifth of the population depends on food aid, and the majority of the country’s food is imported from neighbouring countries, many of which are unstable. This doesn’t bode well for the country, and begs the question: where is the national food policy that would foster sustained food production and security? What should a national food policy for South Sudan entail?

A map showing the 10 states of South Sudan in various colours

Credit: South Sudan Forum For Public Policy

As I noted earlier, at the heart of any food policy must be the repositioning of the agricultural sector. South Sudan’s agriculture is characterized by subsistence farmers and disproportionate involvement in agriculture and forestry, compared to livestock and fisheries. There ought to be a concerted campaign to educate farmers about the importance of diversifying their crops and exploring opportunities in the livestock and fisheries sector.

This will require the bridging of the information divide. In other words, South Sudanese farmers ought to have improved access to better extension services and information that will sensitize and inform them about markets. ICTs will be useful tools for enabling this and should therefore form a central part of the overall food security strategy for South Sudan. However, the full incorporation of ICTs will depend on improvements in connectivity and access– mobile subscription, broadband access and total internet users are all less than the average for Sub-Saharan Africa.

Nonetheless, traditional ICTs such as radio, which is relatively ubiquitous in South Sudan, may be used as a key first step to offer extension services that tackle issues, including irrigation cycles, pest control, access to seeds, fertilizer, transportation and prices. These services may be provided via a series of regularly aired radio programs and features that capture the voices and interests of the farmers. The use of traditional ICTs and other less advanced but newer technologies are likely to be more contextually relevant and appropriate, compared to high end ICTs. The latest technology is not always suitable. In the long-term, many opportunities to use the latest ICTs will mature. That is to say, they exist now, but the infrastructure in not in place to facilitate their effective implementation for the benefit of the majority.

Here are a few of the ICT opportunities:

The provision of access to financial services via mobile money
Improve irrigation and water management services using remote sensing technologies and GIS
Establishment of legible rural and agricultural markets through market information systems
Reduction of waste through proper storage and transportation facilities enabled by logistics technology
Text and other mobile-based extension services to create access to better agriculture and livestock inputs

Despite the immense scope for growth in South Sudan’s agriculture sector, much depends on the development of indigenous agricultural and livestock research, animal health services, infrastructure (including roads and bridges), and the stability of the regulatory and political environment.

July 8, 2011/by actualize

Connectivity, Originally posted on the GBI Portal

Administrator Shah Emphasizes the Role of Mobile Banking

At an OECD Meeting on May 27^th, 2011, Administrator Shah outlined three areas of reform for USAID, one of which was “leveraging the role of science and technology,” particularly through mobile phone banking systems. The announcement should not come as a surprise, given the growing movement among the leaders of the agency to support mobile phone programs.

Photo Credit: USAID

Shah’s announcement is coupled with his recent talk with MIT economist Esther Duflo at the USAID Development Forum on May 23^rd. During the question and answer session, Shah referred to the power of mobile banking, citing the financial security it provides to rural farmers.

In addition to voicing support for mobile banking, USAID has supported specific initiatives, coming to an agreement last year with the Gates Foundation to provide a $10 million incentive fund to companies in Haiti who provide mobile financial services. Speaking about the fund, Shah said, “Before the earthquake, fewer than 10 percent of Haitians had ever used a commercial bank. A mobile money system can restore and remake banking in Haiti and serve as an engine of inclusive growth.”

Eric Postel, assistant administrator at EGAT, has led USAID’s mobile money programs in Haiti, including one project that allows Haitians to purchase emergency relief food supplies via mobile money payments. Postel praises Haitian shop owners who accept mobile payments, which, he claims, are “broaden their client base” and lower their risk by not carrying cash payments to the bank.

Photo Credit: USAID

Other leaders in USAID have shown support for mobile banking as well. Maura O’Neill, Chief Innovation Officer at the USAID Development Innovation Ventures in the Office of the Administrator, recently co-hosted the Mobile Money Summit in Afghanistan. At the summit, the USAID Mobile Money Innovation Grant Fund was announced, which aims to create unique public-private partnerships to encourage mobile banking. Currently, “only 4% of Afghans have bank accounts,” and given the success of M-PESA in Kenya and similar services worldwide, mobile banking is a legitimate solution to this problem. O’Neill attended the summit with Senior Advisor to the Administrator Priya Jaisinghani, another notable expert in mobile banking.

USAID’s interest in mobile projects is not new. In 2008, USAID commissioned a report on the use of phones in citizen media. As well, numerous projects targeting women in development, have utilized mobile phones. Mobile banking, however, appears to be a high priority for USAID currently.

June 2, 2011/by actualize

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