According to a recent Economist article, in most African countries far more people have a mobile phone than a bank account. In Kenya, over half of the population now owns a smartphone, illustrating how technology has permeated nearly every aspect of daily life. A good friend who used to live in Mali told me that many young people there would rather go hungry than be without text messaging.
All of the financial and media attention in the West goes to smartphones, as seen by the hyperactive press coverage surrounding Nokia’s recent collaboration with Microsoft. However, while people in London and New York are preoccupied with the newest iPhone, in Nairobi, it’s still Nokia 5130 and 3110. Even with this “classic” hardware, African businesses have been able to develop some genuinely creative applications.
Show me the money
Africa is the global leader in mobile banking, according to one study. Customers may use M-Pesa, a mobile money system with no branches, to send money by SMS. According to reports, in Nairobi, you may even pay taxi drivers with your phone. The popularity of services like M-Pesa is astonishing: people in Kenya conduct over $30 million dollars worth of mobile transactions every day. And, if there are truly more mobile phones than bank accounts in Africa, the industry has a lot of potentials.
Online bank transfer is a secure technique to send money, and it’s especially useful for individuals in rural areas. It’s also a means of earning money. Crowdsourcing employment has taken off quickly. Take a look at Mocality’s African business directory. M-Pesa is used by Mocality, which employs crowdsourced workers to write and edit database entries.
Silicon Valley, Nairobi?
Over the previous few years, organizations like Samasource, Txteagle, and, above all, Ushahidi (also from Kenya) have put African crowdsourcing on the map. New initiatives are always jumping on the bandwagon (or, in this case, into the bush taxi). Many of them are health care or development projects, such as Sproxil. Sproxil has created software that allows the crowd to authenticate drug labels using SMS in Nigeria and Ghana. The objective is to curb the huge pharmaceutical trade.
Some entrepreneurs have begun to consider outside the box and look at more commercial operations. In Nairobi, one of the Ushahidi founders, Eireneh Hersman, recently opened iHub. It’s a coworking space where coders can unwind in their natural habitat, with high-speed internet, comfortable chairs, and only a smattering of attire required. Physical space is also a portal to an online community of developers, investors, customers, and coders who are all eager to explore the commercial potential of Africa’s mobile and internet revolution.
In a blog covering Africa last year, we talked about the difficulties that the young tech sector faces: crooked politicians, upheaval, a lack of infrastructure and basic resources. One year later, these issues remain significant. One reason the mobile industry is so successful is that high-speed broadband is still sparse and expensive, if not completely inaccessible. People are willing to go without food in order to acquire a mobile phone, but in a better world, no one would have to make that decision.
However, as African businesses are demonstrating, necessity is the mother of invention. I’m looking forward to seeing what the African community has in store for 2012.