NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Thursday, July 14, 2005

Next time you take a taxi in Nairobi, you might not need cash to pay the fare. Instead, you?d text message the fare?s value in surplus mobile phone minutes to your cabbie using Safaricom?s pre-paid airtime cards. The model is similar to Smart Communications?, as first reported in a Digital Dividend What Works case study last summer. It targets low-income entrepreneurs and customers, who can use surplus minutes as an electronic currency of sorts ? a currency more secure and traceable than cash. BBC reports:

Just the other day [Safaricom] unveiled a new service allowing subscribers to buy prepaid phone cards which then enable them to transfer any selected amount of surplus minutes to other subscribers, using text messaging. You can pay a supplier with it, or even create a little bank of phone call credits to sell to others. What [Safaricom] has actually done is to create a new currency — a cyber currency that can be sent anywhere in the country at the press of a button, without needing a bank account or incurring high bank charges. You see what’s happened: the mobile phone is multiplying its revolutionary impact on the lives of the poor, giving them facilities once available only to the rich.

Via WorldChanging. Thanks, Jeremy!