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Mobile devices become banks, libraries and enterprises in emerging markets
15 February 2012
Wireless technology has many applications in lower income, developing markets — from providing farmers with market prices for their crops to connecting remote villages to the internet
The range of mobile applications and technologies on offer
opens a world of trading possibilities to users and can
stimulate rural economies. In addition, m-payment and finance
technologies and services can be provided to enable the swift
transfer of money so users in emerging markets can trade
effectively and securely via their mobile devices.
"At the moment, information lines for farmers — such
as one Vodafone offers in Turkey — are very successful
in terms of being able to get information about crops," says
Steven Yurisich, communications and high tech specialist at
"What we will start to see is a combination of solutions and
applications coming together. Most, in the short term, will be
low tech like SMS but we are starting to see M2M traction with
the usage of simple devices to collect data. The cost of the
sensor or data gathering devices is coming down to a level
where it starts to make sense for a co-operative or even an
As those costs come down so the applicability of wireless
increases for users and groups of users in emerging markets.
The technology can be used to underpin increases in efficiency
as well as enhanced profitability for manufacturers and
traders. In some markets where there is no trade in the sense
that developed markets recognise it, such as bartering,
wireless technologies even have the potential to develop
trading based on money for the first time.
"We’ll certainly see smarter devices that a
village or co-op might afford and joining that together with a
financial services layer will have a significant impact," adds
This will help to avoid waste caused by financing issues. "For
example, if a farmer can’t buy fertiliser at the
right stage in the crop cycle, they buy it and put it on the
ground when they can afford it. Access to microfinancing would
change that and crop yield would be maximised."
Hannes van Rensburg, chief executive of Fundamo, the mobile
payments specialist that was acquired by Visa last year, sees
mobile finance as a way to avoid the inconvenience of cash when
bank branches can be far away.
"Fishermen around Victoria Falls, for example, are very far
away from any bank, but they use mobile money quite effectively
to bank immediately the payments they receive from the
wholesaler for their catch," he says. "Cash is insecure and
inconvenient so mobile financial services are a big value
proposition to consumers."
Yurisich also says wastage within the supply chain could be
minimised through greater dissemination of information such as
what the nearest market’s price for a given crop
is that day.
"In these markets, given the lower penetration of smartphones
and internet, it is a different ecosystem but operators are
developing it and NGOs and foundations are really focusing on
investing in this now," he says. "These farmers have a lot of
waste in the system so their incomes could increase
substantially if they are given some simple tools via mobile."
Van Rensburg thinks business to business payments are another
application for mobile finance that has been overlooked. "Some
of our customers have deployed platforms in support of cash on
delivery," he says. "Coca-Cola uses our technology in Zambia so
as it delivers it gets paid and that brings huge benefits."
That illustrates how mobile finance has moved from being
regarded as a basic means of supporting micropayments to
becoming an enabler of all sorts of transactions.
"It’s a common misconception that mobile money is
just for low value transactions," he says. "Mobile money is at
a cost point at which it is possible to do transactions that
are worth just one dollar but you can do $100,000 as well.
It’s an extremely secure way of paying.
"In fact I’d prefer to use it in developed markets
than the internet-based systems on offer. It enables paying for
things where payment was not previously possible. Obviously
that encompasses mobile airtime but other things such as
utility bills or rent can be paid that in the past involved a
complex exercise in which the customer had to get cash, walk a
distance and make a payment."
Yurisich says operators are well placed because they have their
agent networks to use to communicate the benefits of new
services to users. In developing markets, users typically buy
prepaid top up cards from local agents so those agents could
cross-sell and up-sell these types of services and
"One of the elements operators have are their quite extensive
retail [agent] networks so, as some of the applications get
more sophisticated, there’s a channel to
communicate about the other services available. They have an
unparalleled infrastructure in terms of being able to reach and
communicate with these farmers."
He’s not alone in identifying the
operators’ agent networks as the key means to
communicate about new services. Suzana Moreira, the founder of
MoWoza, which provides a mobile platform to enable trade
between rural and urban communities, also sees agent networks
MoWoza aims to tap into the requirements of users as the rural
to urban diaspora continues in developing countries. She
foresees great need for city-dwellers to send food reliably
back to their home villages and MoWoza has been developed to do
that. Moreira points out that the alternative is sending
parcels on long distance buses with the risk that they are
stolen in transit, impounded at borders or perish during the
"We’re creating a marketplace that can be easily
accessed by a mobile phone or tablet that creates trade in
areas where there is no trade," says Moreira.
"We’ve developed and piloted the service in one
market and a typical scenario involves people that leave their
rural homes and move to urban areas but want to send items
home. Foodstuffs would be a typical example."
Van Rensburg even sees the agents as benefitting because their
businesses can be transformed by the ability to offer mobile
financial services. "The agent only needs a mobile phone, some
ability to take cash and manage deposits and they have a mini
bank branch," he says. "We have instances where becoming an
agent has transformed marginal businesses owned by agents, such
as small groceries, by enabling them to offer financial
For some of these initiatives, it is a very early stage market
but enabling users to trade can transform the economies of
emerging markets, the operators will get their reward from
providing the applications and charging for the traffic and
services they deliver.
"Probably the greatest limitation is in getting the devices out
there and having that end-to-end supply chain," says Yurisich.
"These are fragmented applications and joining them up into a
coherent offering is another challenge. Beyond that, taking in
a financial services element and enabling micro loans brings it
all together. I see that happening in the next 12-18 months."
Van Rensburg agrees but think the agent networks already in
place mean the mobile financial service market already exists.
"It has taken off big time," he confirms. "We have tens of
thousands of these agents and once the payments platform is in
place the offering grows into the provision of other financial
services such as loans, savings and insurances. All current
systems are closed loop systems whereby you can only pay in or
withdraw on the same network, much like ATMs were in the early
days. With Visa now playing an important role these closed
systems can now start opening up."
That opening up will deliver a universal system of mobile
finance that retailers, farmers and business people of all
types will be able to turn to in support of their businesses.
It will introduce process and supply chain efficiencies that
transform the profitability of marginal businesses.
A solar-powered radio link connects the borehole monitoring
system to the nearest point with mobile coverage
Wireless technology keeps water level status updated at
One example of how wireless technology enables businesses to be
run more profitably has recently been deployed at Aloegrove, a
safari lodge and cattle farm in Namibia, which has 4,000
hectares of its 8,300 hectare estate currently allocated for
the lodge and game. The farm attracts tourists with daily big
cat feeding, game drives, hiking and hunting — all of
which are dependent on reliable water supply.
Namibia which has an average rainfall of just 270 millimetres a
year, most falling between January and April. Farms critically
depend on water pumped from boreholes — using wind,
diesel, solar power or mains electricity — from
underground aquifers into surface reservoir holding tanks from
which it can be distributed by pipe.
Aloegrove’s borehole required staff to visit three
times a week to monitor water levels or provide necessary
maintenance. To ease the time burden involved, Aloegrove
decided to install remote electronic monitoring that would
provide a flexible, reliable and cost effective solution.
The farm commissioned a design company, Wood & Douglas, to
create a wireless system that could monitor the system. Alan
Wood, chief executive of Wood & Douglas, said: "While water
level monitoring is taken for granted as being a simple
activity, it suddenly takes on more serious financial
implications. There is the direct labour cost of the person
making the journey to the reservoir, the cost of the fuel for
the journey and the wear and tear on the vehicle involved. By
using a radio reporting system the status of the borehole
reservoir can be signalled immediately to the owner via cell
With no GSM coverage at the borehole site, direct alarm
signalling to a cellphone was not practical so Wood &
Douglas installed a radio link from the borehole to a base
station at the lodge 6.4 kilometres away which does have good
There is no mains power at the reservoir so the company
installed a 12 volt battery system, charged from solar panels.
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