NB Financial Health

June 1

Nandini Harihareswara

NexThought Monday – Needed: A New Kind of Infrastructure: Digital infrastructure must be a priority – and the need goes beyond technology

For decades, the United States Agency for International Development (USAID) and the development community have stressed the importance of infrastructure – building roads so that farmers can get crops to market, or water systems to increase access to safe drinking water. Lack of access to traditional infrastructure has always been a limiting factor for the empowerment of the poor. And where we have needed to, we have invested – both in people to understand these limitations and in the infrastructure itself. But the advent of the communications revolution and the growing ubiquity of the mobile phone require us to also consider a different type of infrastructure – digital infrastructure.

By the end of 2014, there were 3.6 billion unique mobile subscribers around the world. With half of the world’s population on a mobile subscription, digital tools have the potential to tackle intractable development challenges better, faster and more sustainably. These tools create unprecedented opportunities for new services, whether in health, education or agriculture. But for these services to have an impact, we need a digital infrastructure that reaches the world’s poor. This does not just mean cell phone towers or Internet cables; it also means systems like electronic payments that allow entrepreneurs to build scalable and sustainable businesses enabled by digital technology.

However, the need for a stronger digital infrastructure goes beyond technology. A digital skill-set is quickly becoming as valuable to the development industry as knowing another (or several) languages. Development practitioners who can “speak” digital have even more opportunities to make a major impact in the communities they serve. Development organizations can no longer ignore the important role that digital can play in furthering programs, innovations and initiatives. We need to recruit for this skill set, weave it into our staffing patterns, and cultivate it in our current staff.

The need to cultivate a digital skill-set among the development community is clear. In a recent issue of MIT’s Innovations journal, Sara Chamberlain from BBC Media Action wrote about her work getting the Ananya Program off the ground in Bihar, one of India’s poorest states. Ananya uses mobile phones to train community health workers via interactive voice response and equip them with a printed job aid complemented by recorded phone messages in order to improve maternal and neo-natal care. The initial results are impressive – in two years, more than 182,000 unique users have called in, dialing different short codes to play 11.4 million minutes of educational health content. In August 2014, the Government of India approved Ananya’s rollout across India. The program appears to be one of the rare mobile health programs on a trajectory to scale.

But as Chamberlain wrote, designing a scalable and sustainable program surfaced a little discussed, but all-too-common stumbling block in mobile for development programs: negotiating service-level agreements with mobile network operators (MNOs). In Bihar, Chamberlain negotiated 99 short codes with six MNOs to be uniform across networks, at identical (and significantly reduced) prices. Standardizing access and pricing was the only way to capture the volume of users required for program viability. It’s the kind of “getting in the weeds” work with distributors and service providers that is a challenging, yet critical element to scale solutions in developing countries.

Brokering these commercial deals on terms that work for both telcos and development organizations is hard work. It requires not only diligent negotiators, but often policy muscle from governments or funders. We hear all the time that development stakeholders and service providers don’t “speak the same language,” and end up with a poor deal.

Yet the development community and governments have been negotiating with the private sector for a very long time. Negotiating better rates for bulk SMS isn’t all that different from the thousands of public-private partnerships that build roads, bridges, and other critical infrastructure. To develop those partnerships we hired industry professionals, and built expertise among our staff. It takes knowledge, persistence, and a willingness to learn, but it’s an eminently achievable goal.

To help make the process easier, USAID’s Digital Development team is designing tools to build digital skills among members of the development community. These tools focus on subjects like real-time data, digital inclusion and digital finance, and deliberately work to grow the community of development professionals with the right knowledge and expertise to work with MNOs and digital service providers. These resources are meant to support great development professionals who want to use digital tools in accelerating their goals in agriculture, health or humanitarian assistance.

We are also working to build partnerships that focus on building digital infrastructure. For example, we co-founded the Better than Cash Alliance to support governments, private sector partners and the development community in shifting large payments from cash to electronic payments. We saw that as demand for these services increases, the relationship between the development community and the service provider community (MNOs, banks and third party aggregators) becomes even more critical.

Digital technology has created new opportunities to improve the lives of the world’s poorest and most vulnerable. But unless we work to build our collective digital skills, we’ll fall behind. The technology is here, it’s up to us to make sure it has the greatest impact.

Nandini Harihareswara is a Senior Digital Finance Advisor with the U.S. Agency for International Development’s U.S. Global Development Lab.

aid agencies, digital payments, infrastructure, mobile banking, mobile phones, telecommunications