Africa Rising – necessity is the mother of invention

Posted: May 21, 2012 by lpiatti in Business, Creativity, Technology
Tags: , , , , ,

Viva Africa!

According to the GSMA, Africa is now the world’s second largest mobile market by connections after Asia,and the fastest growing mobile market in the world.

As the world makes strides into the Post-digital age I can’t help but smile when a continent like Africa leads the charge in Mobile. Does your conscious scream – “That is not possible! Africa?” Check out this presentation of stats, data, graphs, analysis and insights on the mobile telecoms sector in Africa prepared by @JonHoehler and @Andrewmchenry, to get a taste of what i am talking about.

425px” id=”__ss_11227820″> Insights into Mobile Telecoms in Africa

View more presentations from Jon Hoehler

How is this possible?

Is this because we have a particularly tech-savvy continent? I would say, No. Instead, it is a classic case of necessity being the mother of all inventions.

As a developing world we are now able to skip the  “right-of-passage” infrastructure development step in order to join the 1st world. Now, i am not saying Africa is a 1st world continent, but rather that we can now jump ahead of certain 1st worlds ( in certain sectors) because we don’t have to follow the norm of massive infrastructure development for things as silly as phone lines. Instead we skip straight to mobile & wireless.

One key area that is driving this in Africa is Mobile Money. (see economist for full article below)

A new survey of global financial habits by the Gates Foundation, the World Bank and Gallup World Poll found 20 countries in which more than 10% of adults say they used mobile money at some point in 2011. Of those, 15 are African. In Kenya, Sudan and Gabon half or more of adults used mobile money. In contrast, in countries with more developed financial systems, the share of adults who use mobile money is tiny—1% in Brazil and Argentina. If you think of banking by phone as just a way of using financial services, then these African countries—where people sometimes live several days’ walk from the nearest branch—are much more financially literate than you might think, just by looking at how many banks they have.

Most mobile-phone transactions are tiny. Market traders, for example, use mobile phones to pay peasant farmers for a single bag of cassava or maize-meal. One of the most successful mobile-phone products in Kenya is a SIM card costing just a few cents—but that is all people need for the occasional transaction. Mobile phones are also used to bank remittances from family members abroad. This may explain why mobile money has done so well in Somalia, a country which barely has a government, but where a third of adults said they used mobile money last year. Somalia is one of the countries that most depends on remittances: one study found that 80% of the capital for start-up firms came from the diaspora. Without mobile banking, this lifeline would be weaker than it is.

For the most part, mobile-phone money is a substitute both for paper-based banks and for, say, sending cash via a bus driver. It enables people who cannot get to a branch or ATM to use financial services. This helps offset the bias of the banking system towards the well educated. In Africa only about 10% of people with primary or no education have bank accounts, compared with 55% of those with tertiary education. But rates of phone banking in some countries are high enough to prove that the practice is spreading beyond university graduates to the rest of the population.

Sometimes, though, mobile banking goes hand in hand with the familiar kind. In Kenya, where a staggering 68% of adults use mobile money (by far the highest rate in the world, partly because regulation is extremely light), more than 40% also have ordinary bank accounts. The leapfrogging technology can also help the old-fashioned kind it has just vaulted over.

 Look out world – Africa is rising! Just goes to show what can be achieved when we…
Dream.Dare.Do
Comments
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