Upwardly mobile

Portable telephones are proving an income earner for savvy producers

Mobile phones have caught on in the developing world to an even greater extent than computers. They are small and easy to share. You don't even have to be able to read or write to use them. They are useful for producers who want to increase revenues and handle banking transactions. But more work is needed to lower costs and adapt services to local needs.

The figures are a marketing strategist's dream. Half the world's 6.5 billion people now use a mobile telephone, compared with 2 billion just 2 years ago. By far the biggest boom in mobile telephony has been in the South. There are now more than twice as many mobile owners in developing countries as in industrialised countries. Subscriber growth rates in poorer countries are 25% per year, and double that in Africa. Figures are lower in the Caribbean and Pacific, but deregulation has led to a rapid increase in cellphone use there too (see Box).

Mobile phone subscribers per 100 inhabitants

Fuelling the surge is a growing awareness that mobile phones boost entrepreneurship and economic activity, widen farmers' access to markets and allow swift and safe transfers of money. A London Business School study shows that in developing countries an increase of 10 mobile phones per 100 people boosts the national economy's growth rate by 0.6%. Throughout the ACP regions, rural dwellers are finding out first-hand what the studies document on paper. Many producers are turning to cellphones to increase revenues, using them to find out about prices for agricultural produce, receive orders and carry out financial transactions.

Connecting farmers

Cellphones have rapidly evolved into far more than devices for making simple phone calls. Handsets now double as cameras, credit cards and mini-computers amongst other functions. Providers and users in developing countries have been quick to customise phones so that they offer a whole range of ingenious services designed to meet specific needs. In parts of the world where computer access remains scarce, mobile phones enable small-scale entrepreneurs to access valuable knowledge via the Internet. TradeNet, a software company based in Accra, Ghana, has launched a virtual marketplace for agricultural products in West Africa. The service allows buyers and sellers to indicate their needs. This information is then relayed to subscribers as an SMS in one of four languages. Trade at Hand, a project funded by the International Trade Centre, provides daily price information for fruit and vegetable exports via text messages in Burkina Faso and Mali. Other systems offer farmers an SMS alert service, providing weather reports and warnings of disease outbreaks, while women's groups are using cellphones to receive orders and collaborate to maximize sales. In Senegal and Tanzania, fishermen are using their mobiles to check which markets want their catch and to keep in touch with family while away. Mobiles also improve safety, offering a way of summoning help in emergencies.

In many ACP regions, mobile phones offer a new twist to traditional extension services, providing a quick and affordable channel for relaying agricultural advice. In Cameroon, farmers can access CTA-supported Question-and -Answer Services (QAS) by 'beeping' a special number, which alerts an expert to call them back and offer advice. The service will soon be extended to farmers in Benin, Botswana, Côte d'Ivoire, Guinea, Lesotho, Malawi, Namibia, South Africa, Togo and Zimbabwe. In Sierra Leone, a project provides mobile phones to agronomists and extension workers trying to resurrect the country's flagging ginger trade (see In Brief). The phones have made data collection, dissemination and project monitoring and evaluation much easier, particularly in the rainy season when travelling is difficult.

Cellphones are also used to offer advice to producers who cannot read or write. A handset's photo and video recording functions can be useful for explaining a technique and sharing information about best practices. In Kenya, a new system that can read out text in any language via mobile phone is helping banana producers. This Banana Information Line, a special boon to illiterate farmers, is available in Kiswahili and English, and guides users in troubleshooting problems encountered during banana cultivation.

M-banking

Improving access to financial services is vital to reducing poverty, and mobile phones are revolutionising the formal banking sector, especially in remote rural regions. Dubbed M-banking, this rapidly developing sector offers new low-cost ways of delivering a host of traditional services, with huge benefits for users, especially the previously unbanked.

In South Africa, where 48% of adults do not have bank accounts, the mobile banking provider WIZZIT is enabling thousands of people to make retail purchases without cash, transfer funds, buy airtime, and pay bills. A WIZZIT account costs about one-third of a normal one and subscription is done by punching information into a telephone keypad.

In Kenya, M-PESA (see Box) allows customers to complete simple financial transactions using their mobile phone. In Uganda, SIMBA Telecom and the USAID-funded Rural Savings Promotion & Enhancement of Enterprise Development (Rural SPEED) project have launched a money transfer service that uses cellphones to offer financial services to rural areas. In Zambia, telecommunications firm Cellpay has developed a prepaid SIM-based mobile phone payment system for purchases.

The fields of health and education also offer interesting scope for mobile technology. Indian company ZMQ Software Systems has designed mobile phone games to educate the public about HIV/AIDS. The project is now expanding to Africa, using local languages, in Kenya, Malawi, Mozambique, Namibia, Tanzania and Uganda. In South Africa, Cell-Life has developed open-source software solutions that enable medical staff to monitor patients receiving treatment for HIV/AIDS. Through Mobile for Good, a social franchise, users in Kenya can subscribe to receive job listings and health information. The service will soon be extended to Cameroon, Nigeria and Uganda.

By sending an SMS, teachers in Tanzania can access state-of-the-art learning materials. The system, developed by BridgeIt, triggers a satellite to deliver digital content to a classroom television set. Meanwhile, as part of its Digital Arts programme, the Pearson Foundation is training young people in Africa to use camera and video-equipped phones to document pressing social and environmental issues.

A new digital divide?

But even the most sophisticated technology has its limits. Experts say it is important to match designs to local realities and remember that cellphones can only assist in improving livelihoods, not replace the basic raw materials of good products and practices. The digital divide is not restricted to computers, and some say that more needs to be done to ensure fairer access to mobile technology and hardware. One of the main obstacles to wider adoption of mobile telephony is the price of handsets, which typically cost a far higher percentage of income in developing countries than they do in the North. Industry observers believe cheaper handsets could expand the market by as many as 150 million new subscribers a year. User costs can be a limiting factor, especially for more sophisticated operations such as connecting to the Internet, as can access to electricity for recharging the handset (see Box next page).

Often, local legislation holds back expansion. Mobile specific taxes are levied in Ghana, Kenya, Tanzania, Uganda and Zambia, adding significant costs for users. And while the technology exists to make M-banking more widely available, progress is hampered by banking regulations that have been tightened in many countries. Mobile network coverage can be a problem in some areas, but on that front at least, there is light on the horizon. At the November 2007 Connect Africa summit held in Kigali, Rwanda, the GSM Association announced that the mobile industry plans to invest heavily in sub-Saharan Africa over the next 5 years to provide more than 90% of the population with mobile reception.