New mobile technologies, microfinancing and the war on poverty

Embedded in an interesting New York Times article by Chris Nickolson is a subtle yet powerful message for promoters of mobile devises --and indeed, any new technology--in the war against poverty:  The best results are achieved when you move with the natural flow of grassroots creativity.  Often, this means abandoning or suppressing preconceived notions, and building on spontaneous and creative adaptations of the new technology by local people to meet their needs.

What does that mean, exactly?  Well, consider the recent experience of Vodafone, described in the article:

When Vodafone began a pilot cellphone project in Kenya, Nick Hughes, the company’s head of international payments, said, “the idea was to reduce the cost of loan disbursal and recovery, but what we found was that customers were using it for person-to-person transfers.”  As a result, the company introduced a commercial program in Kenya three months ago to make financial transactions possible by mobile phone. Customers have flocked to the service. “We’ve passed the 175,000 mark,” Mr. Hughes said, “and they’re signing up at about 2,500 a day.”

See? They went in looking to minimize transaction costs, reduce risks, maximize profits--the usual business.  But to their immense credit, Vodafone quickly realized that the local people had a far better idea, and they grabbed the opportunity to create a matching program that is now maximizing benefits for company and customers.  Everybody is winning.

There are other heroes in this fascinating little article.  Consider Jamii Bora, "the largest microfinance institution in Kenya, " with over 150,000 borrowers.

The organization, whose name means “good families” in Swahili, began to experiment last year with mobile point-of-sale devices, magnetic-stripe cards and fingerprint authentication to take its remote branches online.

Working closely with Craft Silicon to deploy point-of-sale devices, Jamii Bora is expanding a robust and accessible system that "allows clients in the countryside to make loan repayments, receive disbursements and do other business electronically. Once clients log in with a fingertip, authenticating their identity, they are connected to a central database in Nairobi."

i think Jamii Bora's success expresses a message that is greater than the sum of its technological innovations.  A code that is apparently embedded deep in the hearts and minds of its staff, and is beautifully articulated by one of them, Ms. Munro:

We refuse to abandon the poor. Actually, we are the poor: all our staff are recruited from our members.

Evidently, this message resonates with Vodafone, Nokia, and Craft Silicon.  And with a growing army of socially responsible investors now marching against poverty in Africa and other theaters at the "Bottom of the Pyramid."