By Maha Khan, GSMA Mobile Money for the Unbanked
Pakistan is facing an enormous humanitarian crisis in the aftermath of the countrys worst flooding in its historyindeed, a crisis in terms of victims that is now larger than the last three devastating natural disasters combined (the Asian Tsunami, the 2005 Kashmir and 2010 Haiti earthquakes). According to news sources, one fifth of the country has been affected by the disaster; that is, 20 million people, almost equalling Australias entire population. Given the speed that is necessary to cope with the huge number of people without safe drinking water, food, and shelter, I cant help but think of the role mobile money could play in helping to accomplish the task that aid agencies face.
While mobile platforms have been used by aid agencies to distribute electronic vouchers redeemable for cash or food, such as the UN World Food Programmes (WFP) pilot project for Iraqi refugees in Syria, mobile money is still relatively new in this field. Aid agencies are, however, coming to realize the cost effectiveness, speed, and resilience that mobile money payments can provide in emergency situations.
One such agency is Concern Worldwide. In response to the Kenyan post-election violence in 2008, Concern and its local partner the Catholic Diocese of Eldoret implemented a cash transfer pilot in the Kerio Valley (KVCTP). This programme sought to alleviate the food security problems that affected communities faced after the violence by piloting the use of Safaricoms M-Pesa to distribute payments of affected households. Once beneficiaries (the matriarch of each household) received this electronic value, they could redeem it for cash with any M-Pesa agent and use it to buy the food they needed.
An evaluation of the KVCTP found that, subject to a few conditions, using mobile payments is preferential to food distribution when providing post-crisis support. The pilot highlighted that using the M-pesa system was faster (i.e. overcoming logistical challenges), safer, cheaper, and offered immediate relief to a wider reach of beneficiaries. An added advantage was that beneficiaries stimulated the local food market. The evaluation also found that the mobile phones distributed as part of the project helped to empower members of the community. Following this pilot, Concern is implementing a similar emergency cash transfer programme in Niger in partnership with ZAINs mobile money platform, ZAP.
Given the size of Pakistans displaced population, her damaged infrastructure, the tenuous security situation, and perceived levels of corruption within the government, it is worth assessing the potential of monetary aid via mobile money.
A mobile money platform already exists in PakistanTelenors easypaisa, which offers the functionality to send money from one side of the country to another. Could aid agencies distribute monetary aid via easypaisa? When we caught up recently with the Telenor Pakistan team, they told us that the answer is yes, but noted a few key challenges:
KYC requirements: a number of displaced families have lost all their belongings, including identification, so how do you make sure payments are getting to the right people?
Distribution footprint: what happens when there is no local agent to serve affected communities?
Liquidity: Unless retailers are willing to accept electronic value for payment of goods, customers will want to cash-out their payments, so how do you supply agents in affected areas with cash?
Will mobile money play a role in the relief and rebuilding efforts in Pakistan? For the Pakistani displaced communities, I hope so.
Maha is a Programme Coordinator for the Mobile Money for the Unbanked (MMU) Programme at the GSM Association. In this role, she organises key MMU events and supports the team more widely with planning, research and reporting. Prior to joining the GSMA, Maha conducted social policy research and evaluations in the UK, US and with multi-lateral organisations, such as the World Bank. Her research experience has focused on social and gender inclusion. She holds a MA in International Relations and International Economics with a focus on Conflict Management from the Johns Hopkins University School of Advanced International Studies (SAIS)