It was chaired by Diane Coyle from Enlightenment Economics. She began by pointing out a couple of baseline statistics, such as the sheer number of phones. The panelists then gave short talks:
- Jenny pointed out that the gains in net welfare have come from private-sector investment but said that it still wasn’t clear whether mobile phone-based approaches to developments are better than traditional approaches and said the mobile isn’t a sliver bullet that we can use instead of roads and stuff. She also said that IT policy must be part of the development discussion.
- Ken reminded us that mobile strategies in developing countries should focus on simple systems with low barriers to entry and not get carried away with iPads and broadband and goodness knows what else. He also pointed out that he couldn’t go home by cab and pay with his mobile phone in London, but he could in Nairobi.
- Dawn talked about providing management consultants to help expand the “village phone” business model out of Bangladesh and they have recently been working on village mobile broadband using networks of entrepreneurs. She even talked about witnessing a marriage ceremony by EDGE between a groom in Dubai and bride in Bangladesh! Amazing: there are now 550 of these “Community Information Centres” in Bangladesh. She also made the point about the “poverty penalty”.
All of the speakers were excellent, by the way. It’s pleasure to hear people who know so much about a subject, and have a genuine passion for it, deliver their insights. The questions from the audience were wide-ranging and fascinating, which made for a very worthwhile evening. One of two the issues raised definitely deserve a further debate of their own: the issue of privacy, KYC and the registration of prepaid phones was touched on once or twice but it really only was the tip of the iceberg, and the relationship between markets and regulators (Ken said that some government structures were “not conducive” to mobile payments everywhere) will continue to stimulate discussion.
A chap from the Rwandan Central Bank was in the audience, and he asked a question that Diane and I both thought deserved way more discussion than there was time for. He said that the Central Bank was very excited about the use of mobile phones for money transfer but he was concerned because the MNOs involved had started talking about cross-border transfers. The regulators had limited experience of cross-border electronic transfers and weren’t sure what the impact might be. This was a very reasonable point to make. A couple of our chaps are off to Clarion’s excellent Mobile Money Transfer conference in Dubai, so I’ll ask them to listen out for any similar discussions there: perhaps this might be a topic for a future event.
What I was most interested in, of course, was mobile money. Dawn raised the GSMA Mobile Money initiative and mentioned the role of the Bill and Melinda Gates Foundation Financial Services for the Poor programme, which linked to another of the audience questions about the reasons for M-PESA’s success and how replicable it might be. Well, we’ve been working for the Financial Services for the Poor programme for some time — some of you may recall Paul Makin’s presentation about the smart banknotes initiative at the 13th Digital Money Forum last year — so I happen to know that Ignacio Mas and Amolo Ng’Weno from the Bill and Melinda Gates Foundation have an excellent paper on this called “The Three Keys to M-PESA’s Success” that will be published in the December Journal of Payment Systems and Strategy. Watch out for it.
P.S. I saw Melinda Gates speak at the TEDx London, before I went over to the LSE, and she was very good.
P.P.S. Our good friends Nick Hughes and Susie Lonie have won the The Economist’s Social and Economic Innovation Award for 2010 for their work on M-PESA. When Nick hired us for the initial feasibility study on what became M-PESA we could never have dreamed that it would be such an incredible success, but with a project manager of Susie’s calibre it soon became a game-changer. Many congratulations to both of them on this very well-deserved and prestigious award.
These opinions are my own (I think) and presented solely in my capacity as an interested member of the general public [posted with ecto]