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Mobile phones: safety net as well as Cell Net?
01 April 2006
Part of RHVP's mandate is to identify and investigate new approaches for addressing hunger and vulnerability in southern Africa. Social protection and, in particular, safety nets are regarded by many as the way forward. Safety nets provide a framework for the provision of a range of benefits or transfer, the more obvious ones being food, cash, inputs and vouchers. But there are other kinds of transfers out there that might also be included in a Safety Nets menu. These might include such things as free access to health and education, but what about cell phones?
The role of cell phones as a safety net transfer is not as far-fetched as it might first appear. In place of providing transfers in the form of food, cash, inputs or vouchers, beneficiaries would receive a free cell phone with a free (and predictable) monthly top-up. Beneficiaries would generate an income for themselves by providing cellular phone services to members of their community.
The concept offers advantages to a range of stakeholders. From the beneficiary’s perspective it is asset-building, productivity-enhancing and predictable. From the community’s perspective it has a range of social and economic benefits from literally giving “a voice to the poor”, to improved market access and better disaster management. For donors and governments, there are clear advantages in terms of cost and transfer efficiency, ensuring an extremely high alpha value. There is even the strong possibility that this safety net function might be adopted by the commercial cellular network provider, not only as a charitable activity but as a strategy for market penetration.
So, aren’t their any obstacles or disadvantages? What about the technology? Well, we all know that mobile phones are literally “child’s play”. What about network coverage in southern Africa? True, this is limited in remoter areas but networks are expanding fast and there is probably a close correlation between areas with good market access (and hence potentially suitable for cash transfers) and network coverage. What about cost? Would the service provided be affordable in poor communities? A recent study in Bangladesh showed that a single phone call can save 10% of monthly household income. Targeting is of course a problem, but then again, it always is.
There are of course a number of other issues that would need to be addressed. Foremost is perhaps the fact that the marginal benefit to each beneficiary diminish as the number of beneficiaries increase: if everyone in the community had a phone, there would be no benefit to the beneficiary. Nevertheless, as with most other safety nets, cell phones are probably best viewed as a complementary transfer mechnism, particularly in conjunction with cash.
You have probably by now noticed the release date of this Comment. This isn’t coincidental but there is an important purpose in presenting this argument; that is, to encourage researchers, practitioners and policy-makers to look outside the box for innovative solutions in the design and delivery of safety nets. But, you never know, there maybe a real role for cell phones in safety net programmes.
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