The mobile World Congress https://www.mobileworldcongress.com/ (27/02-02/03/17) “illustrated ways that mobile technology can be used to address major global challenges, from personalized learning to pay-as-you-go solar”.
We do think that a word of caution on the matter may add a lot to the paramount benefits of the technology. Talking about mobile phone and other smart electronic devices, the connectivity question is: should the users be eligible to connect? As the insiders of economic development issues are aware, it is the same question, sometime forty years ago, micro lenders faced when inaugurated the cycle everybody deserve a loan and in so doing neglected the eligibility criteria: we witnessed financial implosions and negative impacts on both individuals and communities.
There is the risk that history repeats itself: last century the new credo was promoted by microfinance’s pioneers who mystified the concept of the rights of the people to have an equal opportunity (GVT task) with the right to have access to credit (lender discretion). Currently, on the grounds of the digitalization, the technologists have been doing the same mistake in partnership with microfinance providers.
Why the above-mentioned pioneers have been allowed to spread their inconsistent and unsustainable credo? We tried to provide an answer (pages 7-8 and 10-14, https://itunes.apple.com/us/book/id1116912686). Let’s look ahead.
At the heart of the digitalization problem the question is: how to make users eligible to a WhatsApp? We have discussed the matter and summing up, there are two levels of interpretation: macro and micro. The former take from the definition of financial inclusion “provision of financial services to unserved and underserved customers” (Basel III Committee: http://www.bis.org), which refers to customers and not people, meaning that a link with a finance provider is a pre-requisite for whatsoever financial link. The latter requires to shift from product innovation to process innovation and in so doing adding value to the product.
Does it make sense give a mobile to people with $ 2/d income? Last century they did it!. In “Open letter to Fintech” I dealt with the matter: https://www.linkedin.com/pulse/open-letter-fintech-ascanio-graziosi.
By and large to have an inclusive growth the “big job” is to have less unserved and better underserved customers. How to? Two lines of intervention, again , at macro and micro level: the former moving from credit-based economy to community-based economy, the latter with an appropriate market segmentation.
Those who like to have a comprehensive overview of the subject under discussion may click the above mentioned line of the iBook: a suggestion for Sunday’s reading.
Ascanio Graziosi 