Mobile money is an important means of facilitating the transfer of funds across rural areas in Africa, but services are often designed to function in a specific way – which might not be to the benefit of all who are making use of them.
“There are definitely benefits such as the ability to send and receive payment, a reduced risk in transferring funds and, for farmers, it means an increase in productivity as they don’t have to spend time on the road to banks. But there are still a number of challenges,” said Lee H. Babcock, Owner and Managing Director at LHB Associates, during the ICT4Ag conference in Kigali, Rwanda.
According to Babcock low levels of literacy, financial literacy and a lack of trust between users and the operators of mobile money hamper the development cycle and are barriers.
“Other players need to be informed as to what the farmers and customers need. Promotion of features and benefits of mobile money is important and the operators need to get involved more. I don’t want it to be an ecosystem with no support or planning done, and it needs to be a commercially sustainable model. Operators and banks need to look at the costs involved and align it with their customers,” he said.
Christine Martin of the non-profit organisation MEDA (Mennonite Economic Development Associates) spoke of a farming couple that have been part of a pilot program in Zambia where they received e-vouchers for their crops. The vouchers are paid out uniquely to them, so even if they are stolen, nobody else can use them.
“20 000 people have already signed up for the e-voucher pilot, and we have seen that some of them save up to 60% in cash on transportation costs to and from a bank. MEDA launched this pilot program with other organisations such as Dunavant, and Zoona, and have received support from others,” she explained.
However, the pilot is not without its challenges and Martin acknowledges that some participants have gone back to a physical money model. “A new donor came on board after the original donor pulled out … and new donor funding will mean that the project can continue. Mobile money can work,” she concluded.
Charlie Fripp – Consumer Tech editor