How cash is carried across Congo | Hacker News Reader

How cash is carried across Congo

economist.com

59 pointsTurukawa10 comments

Thanks for sharing. Only around 18% of adults in the world receive a salary into an account. In places where employers have made the switch from cash to electronic, it's not uncommon for staff to complain that they've been overpaid, sometimes by as much as 50%.

Too much cash goes missing between employer and employee. It's expensive being poor, but being unbanked makes it a whole lot worse.

>complain that they've been overpaid

Is that a typo?

Not at all!

When people have been paid $x/month in cash for years and suddenly they get paid $1.5x or $2x electronically, some honest folk have been known to complain that the new electronic system must be broken. Whereas what has actually happened is that now its harder for people between the employer and employee to pocket the cash

I'm surprised M-Pesa hasn't entered Congo, seems a real opportunity there for a recognised and trusted mobile banking service.

M-Pesa just launched in Ghana this week. I’m sure other countries will follow. Nevertheless, there is lots of evidence to suggest that it’s not necessarily a silver bullet. While it did work really well in Kenya, Safaricom and Vodafone have had a lot of difficulty replicating it elsewhere.

You could reasonably argue that it has barely been successful outside Kenya. Part of the problem relates to the unique market position they had at the time of launch in Kenya. With more than 60% market share, their policy of keeping it as a walled garden (their economic rationale for launching MPesa at the time was that it was actually a retention tool for customers and so opening it up didn’t make sense to them) didn’t reduce its usefulness.

In other markets where they have more ‘normal’ market shares, this walled garden approach has really impacted their ability to expand. As anyone that has tried to launch a new social network will tell you, network effects, when they’re against you are a bitch to overcome. Having a balance in a MPesa wallet, doesn’t mean much if only 1 in 5 of your friends also have an MPesa wallet and you can’t send it to any of the other 4.

MPesa is a great tool for banking the unbanked and it is definitely the most famous example, but it’s not going to solve the problem elsewhere as successfully as it has in Kenya. It may be part of the solution though and I think it would be great if they could try.

For M-Pesa you also need mobile phone coverage, I think if the only way to get to a place is by canoe, then there's probably no cellular coverage either.

I was just thinking how impossible it seems to get internet covered over the green heart of Africa, but perhaps that's just not the solution (right now). Perhaps a cryptographic sneaker net would work.

If the accountants travel with RFID powered 'credit' cards pre-authorized to ID's then they themselves don't have to bear any risks. The only thing you need then is to supply every village with a RFID reading trading platform (could be a phone or a laptop) to enable digital trades.

Google loons seems to attack this problem by having high altitude ballons that drift on the wind, but can keep their approximated position using air currents.

By not using a wired backhaul, seems possible to get to those remote areas.

M-Pesa has entered Congo and it and other mobile money solutions have already become one of the primary mechanisms by which soldiers are paid. It's credited with reducing corruption by middle-men and senior officers who have skimmed money from salaries in the past. [0]

M-Pesa is offered there by Vodacom DRC [1], the other main players are Airtel Money from Bharti Airtel and Tigo Cash from Tigo. In some cases there are cross-carrier agreements, such as the one between Vodacom/Vodafone and MTN which allows people to exchange M-Pesa and MTN's Mobile Money in any of the countries in which Vodacom/Vodafone and MTN operate across Africa.

But while mobile money has its advantages, especially in the country's more volatile East, the administration in Kinshasa still prefers to promote regular bank accounts for its civil servants because of the knock-on economic benefits from growing the country's formal banking sector.

[0]: http://www.newstatesman.com/2014/04/will-eastern-congo-see-f...

[1]: https://www.vodacom.cd/Entreprise/home/m-pesa/m-pesa

Sounds dystopian, even for me who lives in neighboring Kenya.

The article did not tell me how cash was carried.

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