Three quarters of the world’s mobile phones are in developing countries, and in some African countries mobile phones are being used to pay for taxis and street food.
Capitalising on this technology, two ACT Alliance members worked together in Zimbabwe to use mobile phones to helpvulnerable families affected by drought. By sending a text message to the mobile phones of 400 carefully selected families who had lost their crops and were low on food, ACT was able to provide emergency aid for three months, through electronic money transfers to their mobile phones.
The families received three payments of around US$75, in January and February 2014, to buy food and other necessities. This reduced transport and administrative costs for the organisations, allowed for fast delivery of aid and injected money into the local economy. On receiving the text message, the families were able to use the money to buy goods of their choice in shops or markets that accepted mobile money; alternatively, they could cash in the money.
Many families used some of the money to buy chickens or goats, in order to better provide for themselves in the future. Christer Lænkholm, working with an ACT member in Zimbabwe, said: “The project with mobile transfers of money is the first of its kind that ACT has implemented in Zimbabwe, and even though the technology caused problems to start with, the project is a success.”
The transfer of cash was carried out in cooperation with Zimbabwe’s largest mobile telecom (with 7 million registered customers). Over 10,000 shops and agents in the country take mobile money or are able to convert mobile money to cash.