Mobile Development is Calling

June 15, 2012 By Nicholas Rogacki

Mobile phones, a convenient gadget for many of us, are rapidly becoming indispensable tools for people across the developing world.  From business opportunities to education, mobile phone technology is growing beyond simple communication and blossoming into a vehicle for development and empowerment.  During USAID’s Frontiers in Development Conference, Citibank CEO Vikram Pandit and USAID Administrator Dr. Rajiv Shah acknowledged this important evolution by announcing their joint mobile banking initiative.  Paired with existing mobile programs, this joint venture serves to highlight mobile technology as a valuable tool for U.S. engagement abroad.

The initiative, to which USAID has committed a $23 million investment, seeks to make the storing and transfer of money easier and less corrupt for nine target nations.  More specifically, the program will expand the use of mobile phones as a platform for financial transfers to help avoid the high markups associated with remittances and cash transfers.  USAID has already instituted mobile money partnerships in countries including Haiti where a partnership with the Bill and Melinda Gates Foundation has increased the number of Haitians with access to financial services by an estimated 30 percent.

However, these programs represent only one of a number of mobile applications capable of changing the development game as other mobile programs have targeted global health and food security goals abroad.  For instance, USAID’s Mobile Alliance for Maternal Action  uses mobile phones to connect mothers to vital health care information, while its mFarmer Initiative Fund serves to provide daily market prices and weather reports to local farmers.

Opportunities to expand on these programs can be found across the globe.  The equivalent of nearly 20 percent of Kenya’s GDP is transferred via text messages, and Africa already has over five million cell phone users, a number which is projected to reach one billion by 2016.  That statistic is even more compelling when one considers that in a developing country, a ten percent growth in mobile penetration has the potential to raise annual GDP growth by more than a full percentage point.

In Afghanistan 80 percent of the population has a mobile phone while only seven percent have a bank account.  When USAID assisted the Afghan government to pay government employees via mobile phones, the results were so dramatic that some employees assumed they’d just been given a 30 percent raise.  An expansion of this program has the potential to ensure that the Afghan workforce receives their paychecks on time and in full, a major benchmark considering that many Afghans have to wait months to receive even portions of their earnings.

As America endeavors to maintain global leadership in a fiscally austere environment, fully exploiting mobile technology offers an affordable way to leverage an existing infrastructure for development gains.  The established infrastructure, high techno-literacy rate in the developing world, and daily integration of mobile technology make it one of the most appealing means of foreign engagement now and in the future.  These and other programs represent the commitment to innovation which we must expand upon for U.S. global leadership to flourish.