Africa's mobile economic revolution
Half of Africa's one billion population has a mobile phone – and not just for talking. The power of telephony is forging a new enterprise culture, from banking to agriculture to healthcare.
Mobile phones in Uganda's capital, Kampala: 10 million people across the country own a phone. Photograph: Yousef EldinEarlier this month, on a short bus ride through the centre of Kampala, I decided to carry out an informal survey. Passing through the Ugandan capital's colourful and chaotic streets, I would attempt to count the signs of the use of mobile phones in evidence around me. These included phone shops and kiosks, street-corner airtime vendors and giant billboard ads, as well as people actually using their mobile phones: a girl in school uniform writing a text message as she hurried along the street, a businessman calmly making a call from the back of a motorcycle taxi swerving through heavy rush-hour traffic. Not only were half of the passengers on my bus occupied with their handsets, our driver was too, thumbing at his keypad as he ferried us to our final destination. After five minutes, I lost count and retired with a sore neck. There was more evidence here than I could put a number on.
My survey underlined a simple fact: Africa has experienced an incredible boom in mobile phone use over the past decade. In 1998, there were fewer than four million mobiles on the continent. Today, there are more than 500 million. In Uganda alone, 10 million people, or about 30% of the population, own a mobile phone, and that number is growing rapidly every year. For Ugandans, these ubiquitous devices are more than just a handy way of communicating on the fly: they are a way of life.
It may seem unlikely, given its track record in technological development, but Africa is at the centre of a mobile revolution. In the west, we have been adapting mobile phones to be more like our computers: the smartphone could be described as a PC for your pocket. In Africa, where a billion people use only 4% of the world's electricity, many cannot afford to charge a computer, let alone buy one. This has led phone users and developers to be more resourceful, and African mobiles are being used to do things that the developed world is only now beginning to pick up on.
The most dramatic example of this is mobile banking. Four years ago, in neighbouring Kenya, the mobile network Safaricom introduced a service called M-Pesa which allows users to store money on their mobiles. If you want to pay a utilities bill or send money to a friend, you simply dispatch the amount by text and the recipient converts it into cash at their local M-Pesa office. It is cheap, easy to use and, for millions of Africans unable to access a bank account or afford the hefty charges of using one, nothing short of revolutionary.
Safaricom didn't invent mobile banking: it existed previously in countries such as Norway and Japan, but on a small scale and with nothing like the seismic effect it had in Kenya. The established banks weren't happy at first – they tried to shut down M-Pesa soon after it started – but now they are getting in on the game, and it is estimated that by 2015 global mobile transactions will exceed one trillion dollars. According to California-based mobile-banking innovator Carol Realini, executive chairman of Obopay: "Africa is the Silicon Valley of banking. The future of banking is being defined here… It's going to change the world."
The mobile banking phenomenon spread quickly to other countries in the developing world. Uganda's largest telecom company, MTN Uganda, created its own version, MobileMoney, in March 2009. Within a year, 600,000 Ugandans had signed up. Now, thanks to aggressive recruitment drives to win more subscribers – MTN agents trolling the streets for new customers are known as "foot soldiers" – the service has more than 1.6 million users.
MobileMoney outlets are everywhere in 2011: the distinctive canary-yellow buildings and kiosks that house them are dotted around not just Kampala but the greater part of the country. The MTN network reaches 85% of Uganda, and MobileMoney is available everywhere MTN has coverage. Many of the villages I travelled through, however minor or remote, had at least one tell-tale splash of yellow.
Mobile phones carry huge economic potential in undeveloped parts of Africa. A 2005 London Business School study found that for every additional 10 mobile phones per 100 people in a developing country, GDP rises by 0.5%. As well as enabling communication and the movement of money, mobile networks can also be used to spread vital information about farming and healthcare to isolated rural areas vulnerable to the effects of drought and disease.
Despite the proliferation of phones in Uganda, however, a digital divide persists. How can information be understood and properly implemented when more than a third of the country's adult population cannot read or write? And can complex and detailed information be managed by anything less than a smartphone, which is beyond the means of most Ugandans?


