I visited the same family that has already featured on this blog on a number of occasions, yesterday afternoon. Everyone is in good health including the youngest girl who I was quite concerned about last year. At that time she had looked quite malnourished. Yesterday she looked wonderful and was bright and cheerful and full of energy.
On the way to the house I noticed that the roads were paved and that a large shopping centre is being built near where the family lives. Despite the difficulties Kenya faced during the elections it does seem that things are improving here.
I was only with the family for about 30 minutes. During that time the Mum took a telephone call from her own Mother who is ill at the moment. The older woman lives in Nairobi and needed 350 schillings (about 3.5euros) for some medicine urgently.
My first reaction was that the Mother was wasting money by ringing her daughter with the request. Instead something really interesting happened....
Safaricom (the main mobile operator here) has a system that allows you transfer mobile phone credit from one account to another for free. You simply type in a couple of keystrokes including the mobile number of who you want to transfer the money to, and a security pin number and then press call. Both parties then get notified of the transfer.
Notice that this is effectively peer to peer banking. Whats also really interesting is that you can now use 'mobile phone credit' as a valid currency of exchange. Mobile phone credit is considered so important here that you can give somebody credit (as above ) and receive goods or a service to the equivalent value. The Mother of my friend was going to use her phone credit to pay the pharmacist for her medicine!
Why does this work? The system of exchange is completely safe and no physical money is required for these transactions. There are no fees for the transaction. In a poor country where crime (and in particular robbery) is a serious problem there is a real need to be able to carry out mcro transactions like this. Mobile phones are still stolen of course but the money in the accounts is not. And since the money in the accounts is small there is no real incentive to hold the bank up so to speak!
Its a great example of where technology can challenge old ways of doing things in a transformational way if everyone is allowed participate. Without probably meaning to, a new form of banking and a new currency have emerged from the mobile phone system being accessible to even the poorest person here (on that note the mobile charges are still ridculously expensive but hopefully that will change in time).
If you are in the banking sector and reading this I would seriously take note! In my (humble!)opinion banks should make money on keeping money safe and investing it well. They should not make money on transactions.
If you are in the mobile phone business please do not even consider charging for a service like this. The indirect benefits far exceed any short term profit making here - mobile phones are effectively becoming digital wallets and allowing people to engage in commerce and entreprise that will ultimately beneift everyone including business;)
Gary
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