Mobile devices become banks, libraries and enterprises in emerging markets

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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 Accenture.
“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 individual farmer.”
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 Yurisich.
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. 
Inconvenient cash 
“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. 
Secure payment 
“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 applications.
“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 as critical.
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 journey.
“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 services.”
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. 
Fragmented applications 
“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 safari lodge
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 phone.”
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 mobile coverage.
There is no mains power at the reservoir so the company installed a 12 volt battery system, charged from solar panels. GTB

Further reading from Global Telecoms Business:
Nigeria to 'revive fixed line sector' 07 Feb 2012 
Cheaper broadband and mobile banking in Africa and the ... 01 Jan 2012
Africa and Middle East to reach 18m LTE users by end of 2015 13 Dec 2011
Liquid Telecom builds Zambia fibre net 11 Nov 2011
UN Commission sets global broadband targets 26 Oct 2011
France Telecom plans African expansion 02 Sep 2011