10.1 Mobile Technology Improves Access to Financial, Employment and Entrepreneurial Services, Especially for Rural or Other Hard-to-Reach Populations

Internet access remains out of reach to millions of young people. Connectivity issues, energy challenges, high costs, and geographic or social isolation all prevent young people from accessing the Internet. Mobile phone ownership though has seen astronomical growth in the past six years. Seventy-six percent of the developing world now uses cell phones, and there are almost six billion mobile-cellular subscriptions around the world.78 Many people can now access banking, news, and market information through their phone. The power of technology remains great, and organizations working in rural areas and with hard-to-reach populations are increasing finding ways to utilize technology in their programming.

Box 10.1.1 highlights Equity Bank, a Kenyan bank with over 6 million account holders. They designed a system of rural agents to complement and support the mobile banking platform.

10.1.1 Bright Ideas: Equity Bank Mixes Human Interaction with Technological Convenience to Increase Use of Financial Services

Only about 23 percent of Kenyans have a formal bank account. In Kenya, mobile phones can now be used to make transactions, send money, and buy items. David Mukaru, Sector-Microcredit for Equity Bank, detailed how the bank uses technology to increase penetration of banking services to rural and slum areas. Equity Bank developed an SMS banking product with mobile phone providers to move money to and from bank accounts; SMS banking has also facilitated various payments services such as water bills, electricity, TV, merchandise purchases, etc. SMS service has enhanced and reduced the cost of banking, so much so that over 20 percent of the country’s Gross Domestic Product (GDP) passes through cell phones.

To target the vast rural population (75 percent of Kenyans live in rural areas), especially the young people, and more so vulnerable rural girls who are not yet familiar with technology, Equity Bank is

providing financial education, which includes the use of technology, to about one million young people. The ultimate goal is to empower these young people while also reducing poverty.

Equity Bank has also created an Agency network across the country that is more accessible. It is reachable at much lower transaction cost; ultimately, Equity Agents will demystify and also reduce the cost of banking through a mix of personal services and technological convenience will help increase the number of people accessing formal financial services.

Mobile banking and agency technology will be replicated across the various countries where Equity Bank is currently operating. These five countries (Kenya, Uganda, Southern Sudan, Tanzania, and Rwanda) have similar financial access challenges.

For more information, see www.equitybank.co.ke.

Founders of Souktel, a text message based job-hunting platform featured in Box 10.1.2, realized that young people can utilize mobile phone technology in their context to find and apply for jobs.

10.1.2 Bright Ideas: Souktel Modernized the Job Hunt in the Middle East and Africa

Souktel connects employers to job seekers using SMS and mobile audio technology. Souktel’s mobile phone-based job hunting services can be especially useful in traditional communities in the Middle East and Africa, where young women may not have the same freedom to network and seek employment through conventional means. Internet cafes are almost exclusively the domain of young men but AGYW can utilize mobile phones.

Souktel’s mobile phone technology is also being used to empower young entrepreneurs by linking them with local colleagues through SMS peer networks, or “PeerNets”. Here, young business

owners who need guidance can send in questions from their cell phones, via text message (e.g., “should I offer a 50 percent discount sale in my first month back in business?”). These questions are then received by all members of a registered “PeerNet” group, allowing peers and local business advisors to respond immediately. SMS responses can be sent directly to the individual who posed the question, or to the group at large – promoting real-time learning, and building a database of usable knowledge that can be accessed at any time.

For more information, see www.souktel.org.