The best route to the African consumer

Africa is ushering in positive indicators across the board. The challenge is how to reach this growing demand in a continent where not everyone has access to financial services, rural areas are still highly populated and the costs of expanding ATMs and bank branches to remote rural areas are prohibitive.

The best solution for Africa seems then to be mobile commerce. Mobile phone penetration in the continent is much higher than bank account penetration. According to a report by TA Telecom it reached 80% in December 2013 of which 63% was 2G, 26% was 2.5G (also called EDGE, adding low-speed data), and only 11% was 3G connections. This sets Africa for diverse payment methods, however the ultimate channel to reach the largest portion of African demand is by SMS (2G) through which M-banking, M-retail, and M-payments are made possible. Business Monitor International estimates that the value of mobile transactions on the continent will move from $12bn in 2011 to $85bn in 2016.

Mobile commerce has proved to be a winning formula in a number of African countries. In Kenya it is a true success story. M-pesa, the largest and most developed mobile money platform in the world, has 19.5m subscribers (cellphone users). The platform has also been adopted by 10 Kenyan banks. Central Bank of Kenya data shows that mobile payments in Kenya grew 21.8% to $13.9bn by the end of August 2013 compared to the same period last year. The government has also found the solution perfectly suited to fulfil its goals of financial inclusion, welfare disbursement and inward international transfer promotion.

source: www.howwemadeitafrica.com

Ghana mobile payment system to connect all banks

It will be possible for all bank customers to make payments from their mobile phone from  next year, the Chief The Executive of Ghana Interbank Payment and Settlement Systems (GhIPSS), Mr Archie Hesse, says this follows the development of a gh-link mobile payment system by GhIPSS in collaboration with e-transact.

The gh-link platform introduced by GhIPSS interconnects all the banks and therefore any service available on the electronic platform will be available to the banks.

Currently a few banks have introduced the mobile phone payment system, but with the gh-link platform, all other banks will be able to provide the service.

The mobile phone payment systems will link customers phones to their bank accounts and enable them to make payments from their mobile phones.

The payment system is intended to create more convenience for bank customers and encourage more people to keep bank accounts.

Mr Hesse explained that the system has already been developed and would be tested early next year before it will go live.

He said the introduction of the gh-link mobile was part of GhIPSS mandate to transform Ghana into an electronic payment society that will make payments and banking in general pleasurable and convenient for the customer while reducing the cost of operation for banks.

Currently local ATM cards can be used in virtually any ATM, following the introduction of the gh-link ATM.

source: www.biztechafrica.com

Telecoms slow down development of Ethopian tech scene

Lemma, who co-founded iceaddis in May 2011, told HumanIPO the tech space in Ethiopia had much potential.

“There is untapped potential and knowledge,” he said. “The ICT educational sector is growing.”

He said, however: “Even though there is a high potential in the tech space in Ethiopia, what is very visible right now is the challenges and the many problems which hold it back.”

He said the main challenge was the telecommunications sector, which he said slowed down the acceleration of Ethiopia’s tech scene and meant it did not see the economic growth evident in other sectors, which came about due to reforms in spheres such as agriculture and education.

“The bandwidth capacity of Ethio Telecom is 8.6gbit/s. To compare, Kenya has 8.6Tbit/s and plans to expand to 15Tbit/s,” he said. “So I believe the main challenge for techies in Ethiopia – and for any small businesses in the country – is the poor and unreachable service of Ethio Telecom. The penetration still remains below 2 per cent. About 2.5 million people are connected to the internet.

Lemma also pinpointed “restrictive regulations” as a challenge to the development of the sector.

“Customs is one big problem for startups as it is almost impossible to import innovative and new technologies,” he said. “The banking system is old fashioned, and unproductive, the most advanced banking services banks provide is an ATM. There is no mobile money whatsoever.”

Yet, Lemma believes, if these difficulties can be overcome, Ethiopia has the potential, as the second most populous country in Africa and one of the fastest growing economies globally, to compete on a global scale through ICT.

“There is a huge market,” he said. “So techies can develop solutions for the local market and still make good revenues. This will help them to gain momentum in the country and aim big into the global market. The local market enables the developers to quickly bring products to the market and make profit.”

He said the country is already planning on joining the World Trade Organisation (WTO) in 2015, which he said would expose local solutions to the international market.

“Competing on a global scale is generally hard for East African companies – as the playing field isn’t level,” he said. “But the current solutions from iHub, such as Ushahidi, show that East African companies can indeed compete in the international market.”

Asynchronous transfer mode in UMTS

It is a telecommunications concept defined by ANSI and ITU standards for carriage of a complete range of user traffic including voice , data and video signals.

ATM was developed to meet the needs of the Broadband Integrated Services Digital Network, as defined in the late 1980 s, and designed to unify telecommunication and computer networks. It was designed for a network that must handle both traditional high-throughput data traffic (e.g., file transfers), and real-time, low-latency content such as voice and video. The reference model for ATM approximately maps to the three lowest layers of the ISO-OSI reference model: network layer, data link layer and physical layer.  ATM is a core protocol used over the SONET/SDH backbone of the public switched telephone network (PSTN) and Integrated Services Digital Network (ISDN), but its use is declining in favour of all IP.

ATM provides functionality that is similar to both circuit switching and packet switching networks: ATM uses asynchronous time-division multiplexing,  and encodes data into small, fixed-sized packets (ISO-OSI frames) called cells. This differs from approaches such as the Internet Protocol or Ethernet that use variable sized packets and frames. ATM uses a connection-oriented model in which a virtual circuit must be established between two endpoints before the actual data exchange begins. These virtual circuits may be “permanent”, i.e. dedicated connections that are usually pre configured by the service provider, or “switched”, i.e. set up on a per-call basis using signalling and disconnected when the call is terminated.