The idea to use mobile phones (here and here) to help economic development in the most remote corners of the world is fascinating and definitely smart. For one thing, mobile phones have already reached the Bottom Billion. In 2007 there were 45 subscribers per 100 inhabitants in the developing countries. That means that we can now expect to have one mobile in every family. Everywhere. As well in communities where services like water, electricity, hospitals, schools or transportation are still far away.
What poor people mostly need are functioning institutions. And market is one of these. If market is not working, farmers will pay higher prices for what they buy and got less money for what they sell. Moreover they could buy or sell at the wrong time and possibly in the wrong place. In the words of the government of Rwanda,
the success of these farmers has been greatly affected by lack of access to pricing information. Many times, farmers speculate what crops to grow and what prices to charge at harvest. Some farmers depend on middlemen to dictate the prices and in most cases the latter exploit the former. For any farmer to earn a decent living from agriculture, easy access to information on market prices is of paramount importance.
Making information flows on mobile phones could
empower farmers to enable them make more informed market pricing decisions and ultimately more successful farming.
The idea of mobile banking goes in the same direction: making a service so critical for development accessible to almost everyone. That will not end poverty, but will probably make the task easier.
Thursday, 16 April 2009