This first story sets the stage…I mean, the tension.

The Standard: Why Central Bank Position on Mobile Banking Attracts Wrath, June 2

Business Daily Africa: Banking the Poor (Special Report on Mobile Banking)

Saturday Nation: Is This the End of the Banking Hall?, June 13

Saturday Nation: Kenya’s Central Bank to Push for New Banking Rules, May 4

Daily Nation: New Law to Make Banking Easier, May 25

Reuters: Kenya to Enact Laws Regulating Mobile Banking, May 25

Following on the heels of the spirited M-Banking 2009 conference in Nairobi in late May, the Minister of Finance just introduced three bills into Parliament to resolve some of the key issues that generated debate. The bills include:

* an anti-money laundering (AML) provision
* an anti-Ponzi scheme provision
* a provision to allow banks to engage in “branchless banking”

The branchless banking provision was a bone of contention for the banks, which claimed that Safaricom’s M-PESA had an unfair advantage in being allowed to set up agents far and wide without government approval, while banks needed to jump through a number of regulatory hoops to open even a bricks-and-mortar branch. The anti money laundering and anti-Ponzi provisions were in response to cries for enhanced consumer protection in what is fast becoming a Wild West new banking frontier.

If the bills become law, it will be interesting to see if the banks take advantage of their new freedom, and whether they can move fast enough to keep up with a dynamic technology company such as Safaricom, whose CEO Michael Joseph is best-known and most admired CEO in the land.

Amid reports that Yunus may sue Telenor, along with the global financial meltdown, the proposed IPO of GrameenPhone in Bangladesh appears to be on the ropes. To raise cash, GP has offered 14% bonds that appear to be “unsecured.” Well, they aren’t the only company in trouble these days. Did I tell you the CEO quit right in the middle of the IPO dance?

What’s microtelecom? A network that relies on smaller, solar-driven base stations, so that it can reach into remote rural areas far off the electrical grid. To date, such networks in parts of South Asia and Africa rely on diesel generators, which is expensive and polluting. Like microfinance, microtelecom is based on the belief that “bottom of the pyramid” consumers can be profitably served, with the appropriate business model.

VNL, a Swedish-based company operating in India, has been perfecting low-cost WorldGSM technology for several years, and will begin pilots and rollouts in 2009, in both India and Africa (Malawi). The idea is to implement low-cost equipment that makes it profitable for telecoms to serve low ARPU (”average revenue per user”) users in difficult-to-serve regions.

WorldGSM is GSM compliant, but is low-power and low-cost, self-deploying (no need for skilled technicians, or air conditioning), and low maintenance. WorldGSM is a re-engineering of GSM technology for the next billion rural, unserved low-income users.

The founder and CEO of VNL is Anil Raj, founder of Hutchinson India, now the country’s number two operator. He also served as Chief Strategic Officer at Sony Ericcsion.

Like GrameenPhone in Bangladesh, which has created a huge interlocking chain of entrepreneurs who sell and maintain service, VNL relies on village enterpreneurs to deploy base stations along roadway or atop village houses. One key part of the kit: a compass to make sure the towers face South to collect the sun.

The New York Times Sunday Magazine ran a long story on a Nokia “user anthropologist” who tours the world trying to learn more about how people use phones and how they would alter the design to suit their needs. See Can the Cellphone Help End Poverty? by Sara Corbett.

In talking about the economic impact of cell phones in the developing world, I often get asked about the impact of cell phones in the U.S. Nothing’s been written on it. So I dug into the topic and with the help of pollster Opinion Research Corp., which conducted a scientific random sampling of 1005 adults, and another Web survey of 110,000 Tracfone prepaid customers, I assembled some good data.

My conclusion? That Americans with household incomes less than $35,000 attribute $4.5 billion in income to their cell phones each year. And that if the 38% of these households that do not now have cell phones were to acquire them and earn money at the same rate, it would add $2.9 to $11 billion to income for these bottom two quintiles.

You can read the press release and paper (”Cell Phones Provide Significant Income Gains for Low Income Americans”), which is posted and hosted by the New Millenium Research Council.

I just got a copy of the Japanese edition of You Can Hear Me Now, which has been out since July 2007, and it looks great. A nice cobalt blue cover. Take a look at Amazon Japan. There are lots of reviews there, but of course I can’t read them. If anyone else can, let me know what they say!

Japan’s Marubeni, a huge trading company, was one of the intitial investors in GrameenPhone and the Japanese have a strong tradition of supporting development in South Asia.

(Many thanks to Batman Jim for lugging it back in his suitcase.)

CellBazaar, a kind of “Craig’s list for cell phones” that is available only on GrameenPhone in Bangladesh, won the Best Use of Mobile for Social and Economic Development Award at the GSM Association’s blowout meeting in Barcelona, Spain. Here’s the citation:

“Grameenphone CellBazaar is a user-generated virtual marketplace, accessible via mobile phone or PC to nearly 17 million people in Bangladesh. In developing countries, limited communications hinder commerce and uninformed farmers and traders have little bargaining power with exploitative middlemen. Using CellBazaar, buyers and sellers trade basic goods from their mobiles, bringing the benefits of information exchange and one-to-many trading to a previously unwired rural population. Users post or search an item, spending less than US$.02, either by SMS or WAP or WEB, depending on their preferences. While common telephony establishes one-to-one communication, CellBazaar links many-to-many using the same basic mobile infrastructures.”

Judges’ comments: “Great initiative - full marks for self-sustainability. This grass root level initiative is not only for operators to make money but for rural folks to sell and trade their goods and increased price transparency and help for the illiterate is also available. It has clear environmental benefits through reduced travel.”

CellBazaar was founded by Kamal Quadir, brother of Iqbal Quadir, one of the founders of GrameenPhone. The company was initially developed by Quadir when he was a student at MIT’s Sloan School of Management, and was a prize winner at MIT’s annual $100K Entrepreneurship Competition.

See the proud press release on Telenor’s web site.

At the end of the year I was interviewed by Leonard Lopate, noted book maven, on New York’s WNYC (20 minutes).

Underreported: Cellphones in the Global Economy

Dear Mr. Sullivan,
 
I hope this e-mail finds you well into the new year.
 
As you know, the Kenya Elections has been an ongoing situation keeping us at AfricaNews.com pretty busy. Here is some background on what we are doing and in terms of mobile reporting. Pretty interesting stuff that might be interesting to you and your readers. 
  
Rgrds,
 
Ben and AfricaNews.com team!
+31 (0)23 531 5040
benwhite@africa-interactive.net
 

See Voices of Africa for mobile news reports, and see how cell phones are democratizing the media.