MIFOS, Mud, M-PESA, and M-KESHO
Our crops are in the ground; the rains are nearly daily; and I am counting down the days until harvest. This past week: we set forth with our MIFOS deployment; had more unplanned detours due to rain; and the Kenyan banking world was rocked by M-PESA and Equity Bank’s new mobile banking product, M-Kesho. This is a bit of a long blog, so I will dig right in.
We just had Fanon Gikonyo, from Mashariki (Eastern) Solutions, come to the project. He is going to be implementing MIFOS for us in the coming weeks. This last week we conducted a gap analysis to see how neatly the banking software would serve our CED operations. The whole CED team was involved in the gap analysis: Joseph Gikaro, Peter Gati, Moses Woirungu, and Erick Kichere all provided a great level of detail that will be invaluable for the process. After the site visit, Fanon headed back to Nairobi to start the MIFOS build. I will keep everyone up to date as this deployment unrolls.
Rainy season is definitely an experience. I don’t think that I have ever seen it rain like it does here. The closest that I can compare it to would be the rain while we were in Nicaragua’s RAAN. The power of the rains is definitely easy to romanticize, but I generally try to steer clear of such feelings, and, instead, opt to try to stay as objective as I can; however, it is at times awe-inspiring.
We work in agriculture, so rain is a key ingredient to success. Rainy season does, however, create a significant impediment to timely transportation. The mud, potholes, ponds, etc.., created by these heavy rains can make for logistical nightmares. Last week, Laura, David, Kelsey Timmerman, and I got stuck coming back from Nyametaburo. The river that divides Naumetauro and Isibania had swelled and become impassible while we were out, so we had a long, muddy detour through Nyangiti, which added an additional three hours to our walk home. The road along the way was riddled with stuck vehicles. It looked like the Automotive La Brea Tar Pits, which made the possibility of a pick-up out of the question.
This is an all too common scenario. In our case last week, the detour resulted in me preparing dinner a bit later than usual, and us being covered head to toe in mud, but imagine more dire situations (or even the mundane day-to-day wear and tear). At least half of every year is like this. Take an already disconnected, rough system of dirt roads; add copious amounts of water; and, then, you have a whole host of problems.
Lack of infrastructure can be a rather significant impediment to a lot of steps in the elusively difficult-to-define “development process”. Sometimes steps in this process can be skipped, while other elements cannot. Bono’s NYT article from last month, surveyed a lot of recent developments in Africa. The last part of the article highlighted two points, which I will build upon for today’s blog entry: predatory lending and the need for infrastructure.
While some steps are critical and others can be skipped. Mobile phones are probably the best example of the ability to skip some steps in infrastructure development. Mobile phones have almost completely made landlines an anachronism in much of the world- this includes sub-Saharan Africa. Much of the Developing World has simply skipped the costly, time-consuming step of installing landlines, and went immediately to mobile phones. The use of a computer to access the Internet is also a step, which can maybe not be fully skipped, but at least sidestepped through the use of mobile phones. David has gone into detail in past blog entries about our democratic usage of Internet-enabled, low-cost Nokia phones, so if you are interested, I would recommend going through his entries.
This past week the Kenyan banking community has been pulsating with activity regarding yet another attempt to either skip or sidestep a step in the infrastructure development process. M-PESA (mobile money), which I have spoken about in past blog entries, has partnered with Equity Bank of Kenya to create a new mobile banking product: M-Kesho (or mobile tomorrow). Nuru is looking to partner with FrontlineSMS:Credit to develop a similar interface, which has long been in the works, but with two giants like M-PESA and Equity Bank coming out with a product like this, it really stands to revolutionize the way Kenyans bank. I hope this new product ushers in a era of competition among the banking community to really service the needs of the Bottom of the Pyramid.
We still haven’t figured a way to get around the obstacles created by undeveloped roads during rainy season; in our defense, I asked Stanford’s Extreme Affordability Program to develop zip lines when they came out here several months back; and, I am still waiting for their reply. Some steps can, indeed, be skipped. Whether or not M-Kesho or other mobile banking products are skippers, sidesteppers, or dead-ends, I will discuss next week. While M-Kesho looks like a good savings product, their loan product looks a lot like the predatory lending, which was mentioned in Bono’s blog. I will go into more detail about this next week. Along with next week’s blog, you can expect an update on our MIFOS implementation.
About Aerie Changala
Chief Executive Officer — Aerie earned his BA in International Affairs from John Cabot University (Rome, Italy) and his MA in International Conflict Analysis from the University of Kent (Canterbury, UK). He served as a Peace Corps Volunteer in northern Burkina Faso. Aerie has been part of Nuru’s leadership since Nuru’s earliest days. Aerie initially served as Nuru’s second Team Leader in Kenya (following Jake) and has since led scouting, launching and designing of Nuru’s projects. Having spent the majority of his adult life living throughout Europe and sub-Saharan Africa, Aerie has traveled extensively, speaks seven languages, and brings a global perspective to his work at Nuru.Read More Stories of Hope