Micro f inance lo ans grew the market f o r grameen p

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Unformatted text preview: ese f ishermen were able to increase their pro f its by an average o f 8 percent even tho ugh co nsumer prices f o r f ish dro pped 4 percent. The trends benef iting bo th buyer and seller o ccurred because the f ishermen no lo nger had to thro w away unso ld catch previo usly lo st by sailing into a po rt af ter all the buyers had lef t. The pho ne-equipped f leet no w see mo re co nsistent pricing, spreading their catch mo re evenly whereas previo us f isherman o f ten inef f iciently clustered in o ne market, o verserving o ne po pulatio n while underserving ano ther. A Lo ndo n Business Scho o l study f o und that f o r every ten mo bile pho nes per o ne hundred peo ple, a co untry’s GDP bumps up 0.5 percent.J. Ewing, “Upwardly Mo bile in Af rica,” BusinessWeek, September 24, 2007, 64– 71. Bangladeshi eco no mist Mo hammed Yunus wo n the No bel P eace P rize based o n his wo rk in the micro f inance mo vement, an ef f o rt that pro vides very small lo ans to the wo rld’s po o rest entrepreneurs. Micro f inance lo ans grew the market f o r Grameen P ho ne Ltd., a f irm that has empo wered o ver two hundred and f if ty tho usand Bangladeshi “pho ne ladies” to start businesses that helped their co mmunities beco me mo re pro ductive. P ho ne ladies bo ught a pho ne and special antenna o n micro credit, allo wing them to beco me a so rt o f village o perato r and charge a small co mmissio n f o r sending and receiving calls. Thro ugh pho ne ladies, the po wer o f the mo bile reaches even tho se to o po o r to af f o rd buying o ne o utright. Grameen P ho ne grew, reaching revenues o f o ver $ 1 billio n, and became Bangladesh’s largest teleco m pro vider. In ano ther ingenio us scheme, pho ne minutes beco me a pro xy f o r currency. The New Yo rk Times repo rts that a perso n “wo rking in Kampala, f o r instance, who wishes to send the equivalent o f f ive do llars back to his mo ther in a village will buy a f ive-do llar prepaid airtime card, but rather than entering the co de into his o wn pho ne, he will call the village pho ne o perato r and read the co de to her. [The o perato r] then uses the airtime f o r her pho ne and co mpletes the transactio n by giving the man’s mo ther the mo ney, minus a small co mmissio n.”S. Co rbett, “Can the Cellpho ne Help End Glo bal P o verty?” New Yo rk Times Magazine, April 13, 2008. When pho nes can be used as currency f o r purchases o r payments, who needs Visa o r, f o r that matter, a wallet and cash? The M-P ESA mo bile banking service run by Kenya’s Saf arico m, allo ws custo mers to transf er cash using text messages. The majo rity o f Kenyan adults have MP ESA acco unts, paying f o r everything f ro m gro ceries to cab rides to scho o l tuitio n. The service can also allo w f amily members to quickly and securely send cash acro ss the co untry. Only 4 millio n Kenyans have traditio nal bank acco unts, but 17 millio n use M-P ESA, and upwards o f 11 percent o f Kenya’s GDP f lo ws...
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This document was uploaded on 01/31/2014.

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