Mobile money to help pregnant women get to health care

In the under-developed world a hospital can be miles away but the trip may seem like an eternity. For a mother having childbirth complications, the only transportation available to them may be walking. That task may be impossible for a pregnant mother experiencing pain. Cars are few and public transportation may be unaffordable for these women.

One mobile phone service helps to speed access to money for women who need help getting to medical care. M-PESA is a mobile app that is funded in part by the UK’s DfID office to improve maternal health.

From the Women's News Network, writers Eva Fernandez Ortiz and Shubhi Tandon explain the app to us.

Only half of Tanzania’s women can reach a clinic or hospital when they are in need during childbirth, but new specific programs are working to change this. Wayali hospital sees some of the most critical patients in the area. Maternal complications are high on the list, including women who have suffered from obstetric fistulas.

Obstetric fistulas are common in Tanzania. In childbirth they are caused by extended and prolonged labour, which eventually starts to tear the walls of the uterus. Most women suffering the condition also become completely incontinent as they are treated as outcasts by their family and community.

M-PESA, meaning “mobile money” in Swahili, is now providing on-the-ground mobile banking services in areas of health care for women in Kenya, Tanzania and Afghanistan. Efforts focusing on fistula health and maternal health are now on the table as M-PESA works to change lives.

Acting as an “easy access” mobile phone bank for women and their families, M-PESA is one of the most important global programs to help women reach health care facilities in rural Africa by providing quick cash for transportation to clinics and hospitals.

If a rural family without access to a bank needs cash to pay for transportation, the M-PESA program through Vodaphone, along with CCBRT – Comprehensive Community Based Rehabilitation in Tanzania, provides a way for money to be transferred quickly and directly to transportation companies via mobile phone text message. The families then pay back the small transportation loan later.

The streamline design of the program is genius, assisting at often very critical moments for women, especially during obstructed maternal childbirth.

Starting in 2003, with the financial support of the UK DfID, M-PESA began to work closely to help launch a mobile banking test program in Kenya. Finding marked success it later expanded to Tanzania. Another program for mobile phone banking, WIZZIT, has begun successfully also in South Africa.

Health experts see opportunities with mobile banking technology

Mobile phones may be the easiest way to reach remote villages in the under-developed world. Well over sixty of the under-developed world's people own a mobile phone. Many have been using their phones for mobile banking as a way to prevent theft and to build savings. Developers are now looking into building health apps so mobile phones can help to meet medical care needs for poor people.

From the PBS Newshour, writer Talea Miller provides this summary of the benefits seen with mobile phone technology.

Leading the mobile finance charge is Kenya's M-Pesa system, the largest mobile phone banking platform in the world. It has exploded in popularity over the last decade and now serves more than 13 million active customers.

With mobile banking systems on the rise, health experts are hoping to capitalize on the budding technology to make health services more accessible as well.

The mobile finance systems allow subscribers to store and transfer money as credits on their phones, and withdraw cash from local vendors when needed. The tools have appealed to many people who previously had no banking mechanism.

"At the end of the day, mobile is the only thing that reaches villages," said Menekse Gencer, the founder of the consulting firm mPay Connect. She authored a recent report on mobile banking and health for the World Economic Forum and mHealth Alliance.

"There is a massive customer need. How can you conduct your life in an efficient way when you are dealing with cash alone?"

Mobile networks now cover areas of the developing world that internet access and land lines never reached. An estimated 68 percent of people in the developing world have mobile subscriptions, according to the U.N.'s International Telecommunications Union, while only 21 percent have online access.

Gencer said the health field is slowly adopting mobile financial tools, including the World Food Programme, which uses mobile devices for some of its food aid voucher programs.

The application allows a food vender to enter a person's voucher code into a mobile phone, and the system automatically reimburses the vendor via mobile payment. The convenience encourages retailers to participate in the food program, and cuts paperwork.

Phone apps for women at the bottom of the economic pyramid

A mobile phone for someone in the bottom of the economic pyramid can open up a whole world of opportunity. Job opportunities, mobile banking, literacy and health applications can all be made available on the phone, and for someone in the under-developed world, access to these apps can be life changing.

Yet there is an unequal access to mobile phones for women in the underdeveloped world. Mobile phone ownership rates are 20 to 35 percent lower for women compared to men. This inequality is despite the efforts of NGOs to give phones to the poor.

An article in the Scientific American describes a new program that gives phones and application to women to help empower their lives. The "mWomen Program" was launched by the advocacy group called Groupe Speciale Mobile Association. Writer Robin Lloyd describes some of the apps that this program makes available to women in the under-developed world.

Dozens of mWomen programs and apps already exist in the field, often conceived and implemented by local women. Program directors, organizers and field workers are comparing notes and sharing strategies via the GSMA, online bulletin boards and in-person gatherings such as a tech salon in New York City organized in September by MobileActive.

Attendees at the New York event learned of a recent pilot program in Africa to introduce cell phones and a text message–driven community bulletin board in 15 villages in Senegal that helped local women post messages and share educational information about malaria. The villages lack running water and electricity, but 58 percent of residents had used a mobile phone. Staffers with the Jokko Initiative trained locals how to navigate the bulletin board by mapping its phone tree—with labeled sticks on the ground. The bulletin board and phones freed the women of the need for men to read and type their messages for them. Erica Kochi, part of the initiative via Jokko-partner United Nations Children's Fund (UNICEF), says that women's literacy and numeracy went up as they used the phones to share information and calculate savings at the market.

Anne Roos-Weil described Pesinet, a women-run mobile service she co-founded that brings health care to infants in Mali—where one in five children dies before age five, usually from malaria, measles or respiratory diseases—along with other countries in Africa. For a monthly fee of $1 (equivalent to a day's wages), subscribers are visited weekly at home by a Pesinet agent who weighs newborns and asks the mother questions about diarrhea, fever and other health matters. The agent sends the data via a Java mobile phone app to a server accessed by nearby doctor who assesses the child's health. The doctor then recommends a visit to the clinic if necessary, where the child receives a free medical exam and half-price medication for the diseases that kill most children.

Pesinet's subscription base has increased 70 percent since January, and subscribers almost uniformly find it affordable and satisfying. But it needs to double its enrollment to 1,000 subscribers to cover its expenses.

Funding for nonprofits and NGOs can be unstable and subject to the whims of donor nations and individuals. Enter telecommunications companies, along with their customer bases and business models. Telecoms can build a program aimed at social welfare that will take as long as a decade to pay for itself, long after a start-up's donor patience or grant money might run out.

"Telcos have to think of the business angle as well as the social angle," says Shainoor Khoja, managing director for social programs for Roshan, the leading telecommunications service provider in Afghanistan, with 3.8 million active subscribers. "Sometimes NGOs seem to focus on the social angle only, which is their role, without something being sustainable. It's a real problem." Roshan is 51 percent owned by the Aga Khan Fund for Economic Development, so it balances mandates for development and profitability. The company was the first in Afghanistan to post a billboard that featured a picture of a woman.

"Straight-out business-wise we are firm believers that putting a mobile phone in the hands of every woman and girl is essential," Khoja says. "We see the mobile phone as not just one communication tool—we see it as much more. Because the minute you put a voice phone in the hands of the woman, you empower her and also give her access to financial services, information, literacy, safety to pursue a livelihood—a whole variety of things that you and I would take for granted, because we have a phone."

Changing international aid with electronic transfers

We have talked before about how mobile banking can provide a wealth of benefits for those in poverty. An article that we found today introduces us to the possibilities that electronic banking technology can have for international aid.

It is now possible for donor governments to deposit their aid directly into the accounts of those on the "bottom of the pyramid" Electronic transfers can save the donor governments a lot of money and paperwork. The transfers also can cut down on corruption as the money goes through less people who could grab some of it.

From Slate Magazine, writer Henry Jackelen and Jamie Zimmerman introduce us to the possibilities.

Recent breakthroughs in mobile technology, such as biometric IDs and point-of-sale devices that act as portable registers for banking transactions, offer a simple but radical way to reform foreign aid: Donor governments could deliver electronic payments directly to the world's poor. With the click of a mouse, massive amounts of aid could be delivered directly to the poorest, quickly and accountably.

Today, foreign aid is typically measured not by the amount of aid that actually reaches the poor, but by merely adding up the amount spent. While there have been unquestionable successes, more than $2 trillion of aid has passed from rich to poor countries over the last half-century, and as William Easterly wrote in 2002, there has been remarkably little change in the "bureaucratic characteristics" of delivery, regardless of "numerous attempts at reform."
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Two remarkable shifts happening inside developing countries suggest why delivering aid directly to the poor, via electronic transfer, is so promising. Starting around 15 years ago, Brazil, Mexico, and several other countries began to move away from paternalistic policies where the poorest citizens were given commodity aid such as food, and replaced them with a new kind of transfer: direct donations of cash. Many of these programs conditioned the transfers on children attending school, receiving vaccinations, etc., leading to a "created demand" for health and education and, in turn, pressure on governments to improve the quality of these services.

In a parallel shift, throughout the developing world countries are now moving away from cash payments delivered by armored car, post offices, or state lottery offices, to electronic payments directly into recipient bank accounts or through other methods like charge cards and mobile-phone payments.

Breakthroughs in mobile banking, branchless banking—that is, using retail shops as banking surrogates—debit cards and ATMs, and point-of-sale devices, used in conjunction with biometric identification tools such as iris and fingerprint scanners, hold the potential to enable massive, if not universal, provision of cost-effective and highly accessible bank accounts even to some of the most remote, economically excluded populations.

These two changes have already had a revolutionary effect. In Mexico, social transfers have been correlated with reducing poverty by 8.2 percent and closing the poverty gap, or the average wealth of the poor below the poverty line as a percentage of the poverty line, by 23.6 percent. In Brazil, where more than 12 million households receive an average of $55 a month under the Bolsa Familia program, these transfers help to explain the country's GDP growth and the rapid drop in inequality over the last decade. In many countries, recipients can receive their transfers electronically through ATM cards, mobile phones, or via direct deposits into bank accounts.

Gates Foundation to give 500 million for micro-savings

The Bill and Melinda Gates Foundation is hosting a Global Savings Forum in Seattle, and took the occasion to make a big announcement. The Foundation will give a half a billion dollars in grants to expand savings to those in poverty. 500 million dollars will go to a host of different programs that help under-developed world accumulate savings.

From the Business of Giving blog at the Seattle Times, writer Kristi Heim tells us more about the new money. Heim's article also includes an itemized breakdown detailing which programs the money will go to.

At the Global Savings Forum hosted by the Gates Foundation today and tomorrow in Seattle, Melinda Gates said including the poor in financial services is a goal that has been elevated on the world's agenda. Financial inclusion was cited as one of the key development issues by the G20 countries in meetings last week.

"The stage is set for incredible breakthroughs," she told nearly 200 people gathered for the two-day event.

After the rapid growth of small loans for the poor as a development strategy, savings is now being recognized as an effective way for people "use their own energy, their own talents to lift themselves out of poverty," Gates said.

Princess Maxima of the Netherlands, the UN special advocate for inclusive finance, said over the last several years, the focus on savings has increased, along with financial literacy, consumer protection and strong infrastructure, for the two-fifths of the world living on less than $2 a day.

"People need an array of financial services," she said. "It is not only households that need financial services but enterprises, the ones that are the biggest job creators."

One project seen as a model is Kenya's M-PESA, a mobile banking program that is now used by more than 70 percent of the adult population. The program, which lets people send and receive money over mobile phones, is reaching 50 percent of the country's poor, Gates said.

Video: More mobile phone technologies to benefit the poor

Mobile phone use is growing rapidly, and this fact includes the poor people of the under-developed world. Techies are devising ways for the mobile phone technology to improve the live of those in poverty. Mobile banking is already proving to be a big benefit for the poor, as they no longer have to travel to a bank or wait for their money. Even simpler ideas like text messages with helpful health-care reminders are also being explored.

From the Washington Post, writer Cecilia Kang tells us about a couple of technologies being developed by the Grameen and the Bill and Melinda Gates Foundations.

The Grameen Foundation, a Washington-based group known for helping women with the smallest of business loans, has two dozen people in a technology lab here developing mobile Internet applications to help spread its microfinance model. It's warning farmers in Uganda about banana crop rot through text messages and collecting data on spreadsheet applications on smartphones.

And the Bill & Melinda Gates Foundation has dedicated $12 million to help village farmers in Tanzania, Cameroon and Rwanda save money through electronic mobile phone deposits. It has launched a $10 million contest in Haiti to fund the best mobile banking ideas to channel earthquake relief to people who would otherwise stand in long lines at overwhelmed bank branches to collect cash. (Melinda Gates is on The Washington Post Co. board of directors.)

In all, 5 billion cellphones are in use globally and the most aggressive adoption is coming from low-income and poor communities, where the low cost of phones and the availability of cell networks even in remote areas has fueled the rapid growth. The innovations in development programs are relatively new, and it's too early to predict their success. Political instability and dictatorships make it hard to work with telecom service providers, and some central banks are reluctant to cooperate with companies that could take away their control over their citizens' finances.

Even so, cellphones have broken through bureaucracies and are reaching many who traditionally have been isolated from help. A basic phone that sends text messages can cost $20. A family or village can share one phone, with each person switching out cheap SIM memory cards for access. Kenya and Uganda have mobile broadband networks rivaling those in the United States and Europe that support the iPhone and BlackBerry.
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Cellphones are being adopted faster than even the most basic services such as routine medical care and schools. GSM World predicts there will be 1.7 billion cellphone users by 2012 without a bank account. The nonprofit Consultative Group to Assist the Poor estimates 150 million people receive regular social welfare payments but fewer than 25 percent of them have a bank account in which to deposit those funds, save and build assets. Much of that is because bank branches aren't available in rural areas and transaction costs are high.

As such, the Gates Foundation is trying to replicate a popular electronic banking program in Kenya in 19 other nations including Cameroon and Tanzania. Through M-PESA, a joint venture launched by a British development fund and Vodafone, a Kenyan farmer can deposit a few dollars cash with a local shop owner who converts the cash into electronic currency through a mobile text message sent to a city bank. A local telecom provider acts as the armored money vehicle, circulating the funds electronically, and a bank manages the deposits so that even the poorest can save money - a key to breaking out of poverty, aid workers say.

Video: Mobile phone transfers in Niger

Continuing our series of guest posts from Concern Worldwide, a video on the use of mobile phone banking in Niger. The non-profit charity Concern Worldwide works with poor people in the under-developed world to help the survive poverty and hunger.

Using mobile banking to reach the un-banked

The popularity of mobile banking has swept across Africa. The bankers like it because it saves them money to complete each transaction. Doing banking over the phone also saves banks from having to build a branch in remote villages. Microcredit banks have also found that mobile banking helps to lessen the risk on defaults.

From this article from Kenya's Business Daily, Kevin Mwanza writes about how banks and microcredit lenders have used mobile banking.

Worldwide, it is estimated that $20-30 billion is currently on loan to more than 50 million microfinance borrowers.

Here in Kenya, a massive 62 per cent of the population has no access to conventional banking services, leading to the enthusiastic market response to the nascent mobile banking and money transfer services.

“Mobile banking has fast become an important part of financial services in Kenya and microfinance institutions are not lagging behind on this,” said PesaPot CEO Michael Asola, whose firm provides mobile loan technology to MFIs and the Sacco industry in Kenya.

PesaPot recently joined forces with RedCloud Technologies, an international developer of cloud computing financial services platform, to help it come up with mobile solutions that will enable its clients gain real-time insight into their loan portfolios as well as dramatically reduce their costs.

Some of the MFI and Sacco’s that have partnered with PesaPot include RiverBank Credit, Wasili Sacco and Umande Trust.

Other applications include end-to-end transaction features that connect the borrower directly to his bank account over the phone, using any mobile service provider that has a money transfer service, and a feature for loan officers to vet and get loanees directly into the organization’s system while in the field, cutting on unnecessary paper work.

Microfinance’ institutions that have taken advantage of these technological advancements have been able to reach the mass market after vetting borrowers, which enables them to reduce their portfolio-at-risk levels.

Other services that are being provided using these latest technological advancements include micro-insurance, characterized by low premium and low coverage limits, designed to service low-income people and businesses in developing countries.

New US Aid fund for mobile banking in Haiti

US Aid and the Bill and Melinda Gates Foundation have begun a fund to encourage mobile banking services in Haiti. 10 million dollars will be awarded to several different companies who will start up mobile banking services. Only 40 percent of Haitian residents have mobile phones but that number is far greater than regular land lines.

From the Seattle Times blog The Business of Giving, writer Kristi Heim explains the new program.

Modeled on the success of services such as Kenya's M-PESA, mobile money is considered safer than cash and can encourage savings.

The first company to launch a mobile money service in the next six months will receive $2.5 million, and the second operator launching within 12 months will receive $1.5 million. Another $6 million will be divided between the operators that perform the first 5 million transactions, based on the number they carry out.

USAID Administrator Rajiv Shah teamed up with his former employer on the project.

The Gates Foundation is putting up the $10 million, while USAID said it will offer $5 million worth of "technical and management assistance and other funding," through its existing Haiti Integrated Finance for Value Chains and Enterprise (HIFIVE) project.

More than a third of Haiti's bank branches, ATMs, and money transfer stations were wiped out in the earthquake, causing cash shortages. Even before the quake, less than 10 percent of the population had ever used a commercial bank, Shah said.

Mobile Banking challenges in Africa

Mobile banking has flourished in Africa, it makes for a cheap, safe and easy alternative to brick and motar banking. It has even eased the efforts of microcredit banks, as payments for loans can be made right from the phone.

This story from Radio Netherlands talks to mobile banking expert Lukas Wellen. He has set up microcredit banks throughout the world, and has the same set of problems in setting up mobile banks in Africa. Radio Netherlands reporter Johan Huizinga profiles Wellen and the challenges he has encountered.

The economist says that fraud actually occurs in only a small percentage of cases. However, there are many stages at which things can go wrong. The person taking the money to the bank can mess around with the group bookkeeping, he may meet a friend along the way who needs money in a hurry and can't pay him back until next week. Then he can commit fraud with the receipt he receives from the bank and won't have to show to the credit controller for another week.

Lukas Wellen explains that mobile banking removes many of these obstacles. The weekly repayment to the bank can be carried out with a simple text message. All the data goes straight into the computer. Manual administration and paper receipts are virtually unnecessary, since everything can be checked directly by mobile phone and the lender doesn't have to rush off to the bank at three o'clock in the afternoon to deposit his money before it closes.

Safer and cheaper
The group meetings can be a lot shorter since the money doesn't have to be counted and it doesn't have to take place anywhere near the bank. It can be held at a different place - near a church or market, for example - where all the members go anyway on a weekly basis. In other words microfinance by mobile phone is more efficient, safer and cheaper for the customer.

Professor Robert Lensink, economist at the University of Groningen, specialises in research into microcredit. He regards mobile banking as a major step forwards, says it makes monetary transactions much safer. People who have made a lot of money in the market no longer run the risk of being robbed on their way home. And, since they no longer have to go to the bank themselves, it's also cheaper.

However, Lukas Wellen emphasises that the advantage for the bank is more significant. It has direct control and insight into the repayment behaviour of the lenders, which make it easier to attract investors who can be presented with a clear financial perspective.

Into the bush
In fact, credit banks no longer need local branches. Armed with a laptop and a mobile phone, the credit controller can travel into the bush to do his work. For the time being, however, he suggests they keep local branches open. He knows another overhead which can be made cheaper and more efficient.

Nokia launches mobile phone banking services for the poor

Mobile phone banking has been another way to bring the poor the same economic access as those with more money. Many poor in the under-developed world may have phone, but not a bank account. So new mobile banking technologies have expanded to reach those people.

From this Reuters article, reporter Brett Young tells us about Nokia's latest foray into mobile banking.

The world's top mobile phone maker Nokia said on Wednesday it would launch a mobile financial service next year targeting consumers, mainly in emerging markets, with a phone but no banking account.

Nokia said its Nokia Money service was based on the mobile payment platform of Obopay, a privately-owned firm that Nokia invested in earlier this year, and it is now building up a network of agents.

Obopay, which uses text messaging and mobile internet access, charges users a fee to send money or to top up their accounts.

"Mobile-enabled financial services has tremendous growth opportunities," Nokia Chief Development Officer Mary McDowell said, noting there are 4 billion mobile phone users globally but only 1.6 billion bank accounts and 1 billion credit cards.

"There is pretty significant gap between people, especially in emerging markets, who have a mobile device yet don't have a bank account," she said.
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Mobile money is one of the hottest topics in the wireless world, but so far take-up of services has been limited mostly to a few emerging markets, as in developed countries, the popularity of online banking has been a brake on mobile money.

The Consultative Group to Assist the Poor (CGAP), a U.S.-based microfinance policy and research center, has said the market for mobile financial services to poor people in emerging markets will surge from nothing to $5 billion in 2012.