September 23

Scott Anderson / James Militzer / Kyle Poplin

Weekly Roundup: Ending Disease, Growing Coffee and (Still) Distrusting Bankers

Global health practitioners did a double-take this week when Mark Zuckerberg and his wife Priscilla Chan announced they’ll invest $3 billion over the next decade in an effort to wipe out all disease. Wait … ALL disease? Yep, and by the end of the century.

They’ve got a solid plan that involves building a “biohub,” where leading scientists and engineers will convene, and using transformative technology like artificial intelligence. Zuckerberg altered human interactions on a global scale with Facebook; can he go one step further and help cure all diseases? Well, anything’s possible, we suppose.

But a little perspective is called for. First, the National Institutes for Health (NIH) spends $30 billion a year, with just over half of it going to basic research in biomedical sciences. Chan and Zuckerberg’s commitment – while staggering in stand-alone terms – amounts, on an annual basis, to just 2 percent of NIH’s research total. That’s enough to make a difference, for sure, but is it enough to make the difference?

And finding cures in laboratories is the easy part of healing the planet. The hard part is getting the cure where it’s needed, when it’s needed.

Remember that malaria’s long been treatable and curable, yet it still claimed 438,000 lives in 2015. The cure for diarrheal diseases is simple and cost effective, yet they still account for 1 in 9 child deaths worldwide. And before getting too excited about the possibilities of artificial intelligence, remember that if everyone took the low-tech step of washing their hands properly, 1 million deaths a year could be prevented.

Then there’s the reality of man-made horrors like war and corruption, and all sorts of human rights barriers to health.

We don’t want to rain on Zuckerberg and Chan’s conscientious efforts to change the world by using technology, we just point out that a lot of human-centered issues need to be addressed before their goals – humanity’s goals – can be reached.

– Kyle Poplin


The buzz around relationship coffee

We need coffee. The we includes not just coffee drinkers and non-coffee drinkers, but most importantly, the millions of people who grow it. There are many perils facing bean growers. In 2012 it was coffee rust, which wiped out nearly all of Ecuador’s crop. That scourge was related to the primary challenge of climate change, which is bringing high temperatures and new insects and molds that could halve the size of the available land for coffee.

We’re not only going to need every farmer we can find to keep the world’s appetite sated for brewed perfection, those farmers, particularly women farmers, need all the business training they can get. The Relationship Coffee Institute, an organization doing its share to educate women farmers in Rwanda, received a double shot in the form of a $10 million grant announced this week from Bloomberg Philanthropies to expand its programming in Rwanda as well as the Democratic Republic of Congo. The institute is a nonprofit affiliate of Sustainable Harvest Coffee Importers. The Portland, Oregon, company helped popularize “relationship coffee,” which advocates transparent transactions for everyone touching the supply chain – including pricing, profit margins and even the taste of the brewed coffee.

The institute trains farmers to negotiate with exporters, plan business and financial goals, structure transparent deals with coffee buyers and understand how their coffee ultimately appears and tastes when it’s sold by retailers. This marks the second round of funding by Bloomberg Philanthropies in the Relationship Coffee Institute – the first grant was valued at $2 million. In 2015, 829 women graduated from the Rwanda-based institute. The most recent grant will assist an estimated 20,000 women farmers in the program.

“The Rwandan government, after seeing women enrolled in the program present at a major coffee conference, Let’s Talk Coffee, asked the Relationship Coffee Institute to implement its training to all 400,000 Rwandan coffee farmers in efforts to bolster economic growth,” Bloomberg Philanthropies said in an announcement during the U.S.-Africa Business Forum.

In 2015, Sustainable Harvest says it sourced almost 1 million pounds of women-grown coffee from nine different countries.

This relationship coffee idea is still brewing, but the buzz is real.

– Scott Anderson


Wells Fargo, meet Jan Dhan Yojana

India’s Jan Dhan Yojana financial inclusion scheme has gotten plenty of press – most of it positive, and apparently well deserved. It has opened over 220 million accounts since its launch in August 2014, largely among the country’s previously unbanked population. Perhaps the most resonant critique of the program has been the fact that many of those new accounts have been dormant – around 75 percent, in its early days. But over the past year, that number has plummeted to around 25 percent. The initiative was starting to seem like an unvarnished success.

But as a blockbuster report in the Indian Express made clear last week, “unvarnished” probably isn’t the right term. Investigating information obtained from over 30 nationalised and regional rural banks, the newspaper discovered that “bank officials are quietly making one-rupee deposits, many from their own allowances, some from money kept aside for office maintenance. Their ostensible goal: to reduce the branch’s tally of zero-balance accounts.” In one bank, the paper reported, these one-rupee accounts made up almost 30 percent of its total Jan Dhan accounts. According to bank officials, the reason for these shenanigans was simple: They were under pressure from undisclosed higher-ups eager to show that account usage was rising.

Reserve Bank Deputy Governor S.S. Mundra has downplayed the significance of these revelations, noting that it’s not a criminal act for banks to deposit their own money in customer accounts, and that “this kind of fringe issue should not take away the main point (of financial inclusion).” But though it’s less nefarious than the Wells Fargo scandal that has rocked the financial world in the U.S., the parallels are impossible to miss. In both cases, employees faced pressure from above to meet aggressive quotas, and responded by turning to fraud. It’s true that, while Wells Fargo profited from fees on the unauthorized accounts their employees opened, customers in India’s banks came out ahead – if only by one rupee. But that doesn’t change the underlying deception. Sadly, it seems that positive news on India’s financial inclusion program will now have to be taken with a grain of salt.

– James Militzer


Reports Galore

In more positive news, a bunch of reports have come out in the past week – a few highlights:

A study from the Better than Cash Alliance at the United Nations “reviews 25 countries where digitization has had great impact and reveals 10 tangible steps, or ‘accelerators,’ that governments and companies can take to build inclusive digital economies.” Meanwhile, the organization has also released a case study exploring the factors that support and impede the adoption of Person-to-Government and  Business-to-Government (B2G) payments in Tanzania.

Digital finance for all: Powering inclusive growth in emerging economies,” a new report from the McKinsey Global Institute, describes itself as “the first attempt to quantify the full impact of digital finance.” One headline-worthy finding: The adoption of digital finance could boost the GDP of emerging market economies by $3.7 trillion, including $1.1 trillion in China alone.

The GSMA also released the “2016 Mobile Industry Impact Report: Sustainable Development Goals,” a “first-of-its-kind report” that assesses the mobile industry’s current impact in achieving the SDGs, and describes future actions that could increase that impact.

– James Militzer


Half a billion to migrants; Three steps forward, one step back in mobile money

In the past two weeks, both Tanzania and Madagascar announced that they’d achieved mobile money interoperability, allowing customers to transfer money across all providers in these countries. On a more somber note, South Africa-based mobile phone operator MTN Group announced that it’s shutting down its mobile money service there, citing “prohibitive” operating costs. The move follows Vodacom’s decision to end its M-Pesa mobile money service in South Africa in May.

And in a move that’s probably good for everyone except Safaricom, Visa announced that it’s rolling out its own mobile money platform, mVisa, in Kenya, with expansion planned soon in Uganda, Tanzania and Rwanda, followed by Nigeria and (perhaps) South Africa. The product could present a significant challenge to Safaricom’s market-dominant M-Pesa platform, as it works across mobile networks and enables both person-to-person and customer-to-merchant payments.

In other headlines, George Soros is planning to invest $500 million in migrants, including “startups, established companies, social-impact initiatives and businesses founded by migrants and refugees themselves.” He explains why in the Wall Street Journal.

– James Militzer


Successfully navigating failure

A panel about “intelligent failure” at SEEP’s annual conference this week proved to be especially interesting … and confusing.

In the session subtitled “Practical Tools for Building an Organizational Culture Where Learning and Innovation Thrive,” Ashley Good of FailForward asked everyone in the room to share a personal story of failure with a table-mate.

Afterward, a sharer pointed out it’s possible to use a “failure story” to humble-brag. Maybe something like, “As I personally transformed the industry, I found that I had failed in my efforts to properly share my vast knowledge with underlings.” Good added another layer to the discussion: There’s an inherent conflict in painting “a rosy picture of something that’s inherently bad.” That brought to mind a previous SEEP panel discussion in which it was suggested that organizations get the outcomes they incentivize. Do lovingly received stories of failure incentivize failure? An even more curmudgeonly question: Are failure stories “participation medals” for a generation that values the pursuit of goals almost as much as attainment?

By the end of the session it had become obvious that while it’s possible to use failure as a teachable moment, and to “fail intelligently,” it’s not easy nor does it come naturally. As Good said, “Failing forward is a skill that can be practiced.” The trick, we suppose, is to make sure that practice doesn’t lead to even more failure.

– Kyle Poplin



business development, financial inclusion