MobileActive has a great entry on a handful of low cost, low-barrier ways to go mobile, from Twitter to desktop "guerilla" SMS campaigns (best run in developing nations with more lenient SMS rules). Having taken down Jamaica's email->SMS gateway (...a few times...) with a homebrew system for Peace Corps Volunteers to share activity and security tips, it's great to see some better programmed and managed systems (finally!).
This morning's Technology Salon covered the legal hurdles facing mBanking - using your cell phone to interact with your bank account - in developing world scenarios.
The three general models presented provide a good structure for seeing how mBanking is being approached. First is banks adding mobile services as value-adds to their current customers. This is seen often in more developed situations, and is not intended to target the unbanked or new customers. Second are banks specifically seeking new customers (who do not currently have any bank account) through tailored mobile banking. Finally, we see Mobile Network Operators - MNOs - adding mBanking features to their services.
The technical problems will not surprise anyone who's dealt with mobile phones - differing technical requirements and interoperability (of the phones and of the networks). Basic (and therefore, cheaper and more common) phones do not have much to offer for security -- obviously a tough issue if there's to be reliable financial transactions. More advanced phones have the unfortunate downside of being more susceptible to virii and malware. Plus most banks are not particularly invested in having a shared platform, as they would prefer to create proprietary solutions discouraging users from switching banking providers.
The regulatory and legal problems are largely unsurprising as well - how can you "prove" in court that the requested mBanking transaction was approved by the user - is an SMS admissible evidence? Does the country even have an eSignature law to enable electronic authorization? There are massive consumer fraud protection issues, banking regulations (does a mobile provider have to maintain liquidity in case of an "mbank" run?), not to mention which department or ministry of the government will oversee the laws - will it be the technology/IT ministry or the Finance ministry? Once you also enable cross-border transactions, you have to also be very careful of anti-money-laundering (AML) rules, which is all the more difficult with the specific base of the pyramid target market who could best benefit from mBanking, but who may not have a verifiable home address in any normal sense of the concept.
The silver lining to all these problems is that most of them can be addressed through decent regulations - but naturally that presents its own challenges. Regardless there's strong value (e.g. tax revenue for the government) in formalizing the multi-billion-dollar informal economies that mBanking could help with, so there's pressure to create technology neutral but bank-policy-regulated laws that balance usefulness, consumer protection, and limiting monopoly growth, but whether those will overcome the resistance to other problems, including created currencies like cell phone minutes as value (or Final Fantasy codes).
There are huge promises in mBanking for the BoP market, without a doubt. Artisans, small farmers and the like could get paid remotely for their work, and could get commissions or advances for specific tasks. However, the technology and the regulatory framework need to be, in combination, bulletproof and safe for consumers to use without fear. In the case of MNOs being the bank; they must be required to act like a bank in terms of insurance and liquidity. In the case where the MNO is merely a passthrough to the bank, both the MNO and the banks must be able to prevent fraud and crime, provide risk management strategies for themselves and their customers, and find some reasonable transaction security. The governments must be involved creating a strict but not stifling regulatory framework that protects against predatory practices, fraud, and overly rampant capitalism and monopolistic tendencies.
Someone's stealing my best ideas
Wayan found a gem in the Times of India article on OLPC and World Bank funding:
Later this year, the XO laptops are expected to hit the retail stores. Sources say Reliance Communications, which partnered OLPC Foundation to conduct an XO pilot project in Maharashtra last year, is looking at retailing these laptops bundled with its CDMA modems.
The same entrepreneurial idea can feed development, using the OLPC technology instead of (or possibly in addition to) cell phones and PVs. Set up a group of in-country micro-lenders who can walk someone through the usage of the OLPC XO laptops, evaluate requests for laptop loans with local situational and social knowledge, and help with initial setup. Provide micro-loans to individuals with an idea of how to use the laptop in a way that could generate enough revenues for repayment and self-employment. Work with local social customs and systems to find the best way to create social pressure for loan repayment (only x amount of money is available on a rotating basis?), as well as adapt to local markets and needs.
Below are a few ideas (presuming some form of Internet, probably cell-phone-network enabled) that could combine the OLPC, community development, and education with making a bit of profit. There are a million other possible things to do with the laptop, using its built in hardware and software tools as well as adding other open-source software to it, so this is by definition an incomplete list. Only local agents can really know what the local demand for OLPC-related services would be, so take these as very basic, generic ideas:
- Youth could create radio programs with local advertising -- youth gain experience in writing, public speaking, budgeting, aspects of radio operation (physics lesson on radio waves?), as well as marketing. Local industries could advertise goods during their radio program, and this isn't even getting into the FOPSE (For-profit Social Enterprises) possibilities like the LapDesk.
- The OLPC could be used as a traveling/home-visit cybercafe and "digital office" (some tasks might require a portable printer as well) to provide services like:
- Letter/resume transcription and/or typing
- Contact (skype/voip with family abroad?)
- Interaction with eGovernment services
- Access to current market prices for locally produced goods
- Manage an eBay store of artesania / handcrafts
- Remote basic medicine and consultation with urban-based doctors
- Of course, email/chat/web surfing/entertainment and the like if there's a demand for such services
- Schools (or other groups) could offer the public training and adult education -- the laptop is built to support education; so it's an ideal machine to support training in basic computer skills (typing, mousing, etc.); literacy and numeracy, and so on.
So I hope that the Times of India article has their facts straight, and I hope someone's reading -- and implementing -- our thoughts here and at OLPCNews.com.
I'm sure you're tired of hearing me talk about twitter as an innovative and easy tool for outreach and engagement. So listen instead to Amy Gahran and her conversation with the Mars Phoenix rover - via twitter:
This is one of the smartest uses of Twitter for public outreach I’ve ever seen — giving folks a sense of a personal connection to this high-tech mission to find water (and signs of life) on Mars. (Some members of the Phoenix team are also blogging.) I especially like that Mars Phoenix is replying to questions sent in by its Twitter friends (like me).Makes it all seem so much less… alien!
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