Commentator from Asia.
Technology and poverty. The two have proceeded down the ages in uneasy and inseparable companionship. Go back to one of the earliest applications of technology in human history-the wheel. The men or women who had a wheel could carry goods and building material and other such objects more easily than those who did not. It is fair to say that these people had a competitive advantage over those who did not have the wheel-in the context of those particular goods. It is likely that all people being taken to be equally poor, those with a wheel had a better chance of uplifting themselves than those who did not. Once the wheel became commonplace, so to speak, something else would have come up as the latest gadget to be craved-and triggered off another round of acquisition and deprivation. Technology uplifts many-but in doing so, technology also brings deprivation to many others. The rhetoric of the electronic sublime, as once famously described by one of my favourite authors, cannot paper over the contradictions that lie at its heart. Those who strive to use technology to bring about utopian equality would do well to remember this. That being said, human spirit is hardcoded to try and make a difference. The reconciliation between the super ordinate human goal for technology and its own harsh reality can be bridged through focussed innovation, an open mind and patience.
What, then, about mobile remittances-the phenomenon that is burning up conferences around the world? When remittances happen more efficiently and people bank more easily, is it not arguable that a significant (if not equal) number of people also get left behind? Therefore, is there a moral hazard in charging for a service that may be publicly positioned as a poverty-buster? Does the mobile remittance ecosystem seek to address inequalities which may continue in spite of or even be engendered due to this technological intervention? I bring this up because in recent months there has been great emphasis on the perceived capability of remittances to reduce or eliminate poverty. I do not deny that this may be an outcome in some markets. I do, however, believe that as a fundamental positioning stance for the industry as a whole, this is avoidable. Such a stance can only heighten the contradictions of technology and bring it at some stage into the perilous realm of national policymaking- something which we as industry practitioners should influence indirectly but always from a safe distance. Poverty attracts those who mean well but it is treacherous terrain for all concerned. After all, it has two sides- one is the poverty of numbers, as we know and as economists tell us. There is a deeper, darker side as well. That is the culture of poverty, ingrained among people after generations of deprivation and due to lack of opportunity. It may be reflected partly in the lack of infrastructure, basic hygiene, quality of housing and so forth. But it may also be seen in the way people are compelled to live every day. There is, more dangerously, the expectation of poverty. If the cup of kindness is found wanting, the reaction could be bitter, even violent.
But , if remittances constituted a magic bullet, then surely we would not see the practice of poverty in many cities anymore. After all, regardless of its often-touted drawbacks, traditional remittance has been around for a long time now. All too often, it seems that technology seeks to wrap itself in the rhetoric of solving one of the world’s most insurmountable problems. It would help if we could get around this tendency and look at what we can really do. The fact does remain, of course, that remittances constitute one of the key factors in making societies better over time. Mobile technology makes it easier to reach this objective. I argue, however, that the key does not lie in making claims about fixing poverty. The key lies in finding out how value can be used further when it crosses from a more affluent country to a less affluent one. Today, value may be hoarded or spent by a family or individual-wisely or unwisely. It may be used to acquire material wealth, buy essentials or be simply kept in a bank. Yet, with some innovation, it is possible to build enterprises based on this flow of value. After all, when money moves spatially, it’s worth changes fundamentally. A dollar will buy many Indonesian Rupiah or Indian Rupees or Pesos. That itself is a significant material advantage rendered to the end-user of the dollar. He or she can buy much more. Cross-border mobile banks or mobile thrift societies can help enhance this. They can keep moving the dollar downstream more and more, so that its worth keeps increasing. The enterprise can be as diverse as sustainable agriculture, a wind farm, a bus service or a grocery. Whatever it is, the creation of channels that help a remitter choose where his/her money is used eventually can make a big difference to the way remittances are deployed over time. One may argue, of course, that a remitter could get his/her family members to do the same in any case. In the model that I propose, the control over usage of funds-and not just the destination of the funds- lies with the remitter and he/she makes the decision in advance. A smart remittance agency in an origin country which has tied up with a local bank in a destination country could encourage group remittances that are invested directly into capacity building, entrepreneurial investment and other forms of direct and shared ownership. This creates wealth on both sides, deepens ties between Diaspora and home and strengthens the relationship between the migrant and his or her adopted country. But what the dollar also surely does when it is remitted in the right manner is build social equity-on both sides. Those who invest in capacity building and jobs can only generate goodwill and respect-among most people, at any rate. Those who get those jobs have a chance at a better life. The next generation lives well compared to the previous generation. Over a period of time, a corpus of well-off talent is built. A nation gets the human firepower that raises it to a different level.
The network economy offers great hope through the use of mobile technology. As it takes value and circulates it around the globe, it helps enhance wealth-wealth that can change lives for millions. Yet, as we have seen, this has its own moral hazards. The industry of mobile money must surely be very cautious about foregrounding the abolition of poverty as a key objective. We are not here for that. We are here to make life better for people-including ourselves- through shared prosperity. There is an important distinction between the two. The sheer enormity of the task of eliminating poverty is best left to the pulpit of ideology and the sequestered chambers of government. The task of making life better through technology is at the heart of the entrepreneurial spirit and this indirectly helps policymakers make informed choices about how to reduce or eliminate poverty. Our industry must be prudent in what it claims. But it must not shirk from bold ideas that are grounded in reason and deliver tangible benefits to its end-users. Put on the winged boots of Hermes by all means. But also be aware of Minerva’s owl and it’s flight in the dark.
Footnote:
The commentator is a mobile industry professional based in Asia. The views expressed in this column are entirely those of the commentator.
