The document discusses business models for using information and communication technologies (ICT) to help reduce poverty. It analyzes 15 case studies across sectors like education, health, agriculture, and financial services. Successful models had an entrepreneurial start by focusing on customers' willingness to pay rather than needs, and took a systemic approach to scale up by offering related services across sectors to capture more of customers' spending. Leaders face common challenges like developing enabling policies, recruiting agents and staff, and building internal capacity.

1. Leveraging ICT Business Models to Help Reduce Poverty
Webinar IEEE Humanitarian Technology
Marc van den Homberg
26 Jan 2012

2. Agenda
Our methodology: classifying solutions to learn from what works
Rhetoric trumps reality in ICT4D
Financially sustainable models exist in finance and agro-services, to a lesser
extent in health, and not yet in education
Entrepreneurship is key to starting successful services,
while collaboration is key to scaling
2

3. 280 140 15

4. We select both “best practices” and “innovative approaches”,
representative of market-based solutions that work
Initial scan
1st selection Key types of
projects
Africa: 117
~280 Asia: 93 ~140 15 case studies
projects Lat. Am: 31 projects
Global: 14
Note: No implied hierarchy of projects,
but good examples representative of best models
1 Elimination of 2 (a) Mapping of projects based on 3 (a) Elimination when
• fully grant based clients’ needs further study shows
approaches (b) Clustering based on mapping and over stated success
• pre-pilots 40 experts’ interviews (b) Five field visits,
(c) Within each market-based representative of
•“dead” post pilots cluster, selection of
(older than 2008) business models
representative: analyzed
•Best practices (largest scale)
•Innovative solutions (high
potential to scale and at least
completed successful pilot)
Sources: Ashoka; AMG; TNO; Hystra analysis; UN; Experts Interviews, mobithinking.com; mobileactive.org
4

5. We studied 15 cases in 4 clusters
reflecting business models across sectors
Sectors Education Health Agriculture and Financial
support to economic services
Data flow activities
1) Direct access: Value added information 4) Financial
1-way
directly accessed by end-user services
directly from
technology BBC Janala mPedigree Reuters RML Insurance
platform HealthLine Esoko via mobile
M-PESA
2) Local agent: Value added services through local agent
1-way
Drishtee Narayana eChoupal FINO
via
(education) Hrudayalaya eKutir Bradesco
intermediaries
Hospital
Drishtee (FMCG)
3) Crowd-sourcing or crowd-funding:
2-way Information or funds collected from
on 2 sides multiple sources, aggregated via ICT
of technology
platform CKW MYC4
txteagle
Business model

6. The projects analyzed in our case studies span 3 continents
India - Bangalore
• Narayana Hospital
India - Mumbai East India
• FINO • Drishtee
• Reuters Mobile Light • Ekutir
India - Nagpur Bangladesh
• Echoupal • Healthline
• BBC Janala
Nigeria
• mPedigree
Kenya
Brazil • Txteagle
• Bradesco • Mpesa
Uganda
Ghana • CKW
• mPedigree
• MYC4
• Esoko

7. Business models
Direct access Local Agent Crowdsourcing
Technology back-end: source of
information and service
Technology front-end
Client /end-user

8. The “direct access” model: simple information accessible
directly on cheapest ICT device – eg, mobile phones
Technology
End-users front end
benefiting = owned by
from service end users
directly
Technology
backend –
source of
information and
service
Informal
sharing of
benefits of
technology to
with others

9. The “local agent” model: specialized services delivered
by trusted intermediaries
Technology
front end
at local
agent’s
End-user
benefiting
Technology
Technology from the
backend –
front end service:
source of
at local agent no need for
information and
ownership of
service
technology
Technology
front end
at local agent

10. The “crowd” models: 2 way-services through direct or indirect
ICT use, linking two worlds for mutual benefits
Direct crowd-
sourcing by techno- Technology
front end
users (txteagle) = owned by
end users
Client organization
gathering data
(txteagle, CKW)
Technology
backend –
Crowd-funders source and Indirect crowd-sourcing through
funding projects recipient of intermediaries for information
directly through information (CKW) …
technology
(MYC4) …or for investment (MYC4)
1-way service
2-way service
10

11. Agenda
Our methodology: learning from what works
Rhetoric trumps reality in ICT4D
Financially sustainable models exist in finance and agro-services, to a lesser
extent in health, and not yet in education
Entrepreneurship is key to starting successful services,
while collaboration is key to scaling
11

12. The rise of mobile phone and internet usage makes it possible
today to reach the BoP via market based approaches…
100%
67.6
57.7
48.2
38.5
30
22.9
17.5
10.3 13.5
5.5 7.9
Source: ITU World Telecommunication /ICT Indicators database
Note: The developing country classification is based on the UN M49:
http://www.itu.int/ITU-D/ict/definitions/regions/index.html

13. … and yet most projects using ICT for development
are yet to find sustainable business models
Number of projects in database: With market-based mechanisms Fully grant-based,
(not fully grant-based) “dead pilots” older than 2 years
and proven viability on the ground or feasibility studies
(no feasibility study or “dead pilots”)
Note: this database does not include « technology project » such as data collection softwares, that were listed separetely as out of scope

14. Agenda
Our methodology: learning from what works
Rhetoric trumps reality in ICT4D
Financially sustainable models exist in finance and agro-services, to a
lesser extent in health, and not yet in education
Entrepreneurship is key to starting successful services,
while collaboration is key to scaling
14

15. Financial services: case studies
15

16. FINO: some business aspects…(local agent model)
Service Customers
Savings, loans, access to credit, 28 million BoP
remittances, insurance and 23 banks, 10 MFIs, 15 government
pension payouts entities and 5 insurance agencies
Largest
project seen!
Distribution Financials
15k field agents employed Deposits, remittances; free
(Customer Service Points) Remittance $ 0,5 per transaction
Loan 24% interest rate
Revenue US $ 52 million 2011
Profit margin 10-15%

17. Simple ICT banking replaces more expensive practices -
complex ones need consumer education to elicit payment
Money transfers,
remittances, Savings Loans Insurance
payments
Secured money platform Remote access from ICT Remote customers’ evaluation
⇒Avoided safety risk from device and remote payments of premium or installments
carrying cash ⇒Access to bank or other ⇒Cost savings on transportation
⇒Avoided loss or theft risk financial institutions both for clients and providers
from entrusting cash to offering savings, for ⇒Lower price from lower cost of services,
informal intermediaries previously unbanked making it affordable to more clients
⇒Lower cost compared to populations
⇒Safer money deposits New sources of funds Simpler advertising and
money transfers through
from crowdfunding registration process
traditional institutions ⇒Build-up of income history,
allowing to access loans ⇒Access to loans for more ⇒Access to insurance for
borrowers, including the more customers
“missing middle” ⇒Enlarged customer base
⇒Lower interest rates allowing lower premium
⇒New investment ⇒Safety net against
opportunities adverse events
Legend
Service provided by ICT
⇒Corresponding Impact on the BoP

18. Agriculture: case studies
18

19. Agriculture– Reuters Market Light

20. RML: some business aspects…(direct access model)
Service Customers
Customized, localized and
personalized weather Several 100k subscribers in 15k
forecasts, local crop prices, villages
agricultural news via SMS, 4-5
times a day
Distribution Financials
Trade partners such as mobile Free subscription
service providers, Indian post Service packs at $7 per quarter
office, co-op credit society, Revenue $ 1 million 2009
agri-product companies: 1.5k
distributors and 20k retailers

21. Farmers are ready to pay for agro-services as they get
financial benefits from it all along the value chain
Decision on crop Sourcing Sales of Monitoring of
Cultivation
to plant of inputs outputs farmers’ data
Info on demand for Info on best practices and expert advice Info on market Data on farmers’
crops ⇒Better choice of Weather forecast prices and demand income
⇒Cultivation of higher inputs ⇒Choice of place to ⇒Construction of
⇒Better agro-
value crops sell credit history,
practices
⇒Better supply- ⇒Lower transaction allowing farmers
⇒Higher productivity
demand match costs and overall to access loans
⇒Higher crop quality
better price obtained
Info on prices and for outputs Data on farmers’
availability of input harvests
Aggregation of Aggregation of ⇒Better linkage
farmers for farmers for grouped between
purchase sale research/NGOs/go
⇒Purchase at lower ⇒Access to larger vernments and
costs buyer, guaranteeing farmers
purchase
Direct order for
inputs
⇒Guaranteed
authenticity of inputs Legend
Service provided by ICT
⇒Corresponding Impact on the BoP

22. Health care: case studies
22

23. mPedigree: some business aspects… (direct access model)
Service Customers
Consumers: verify authenticity
medicines 2 million consumers and 6m
Pharmaceutical/distribution products protected in 3 countries
companies increase consumer trust In pilot phase 10-20% of tagged
and counterfeit tracking packs generated a verification SMS
Distribution Financials
Direct access in pharmacies Free service for user
Partnerships with HP, mobile Revenue: sales of codes to pharmacies
operators, minus costs SMS, printing, overhead
Profit margin: not known

24. Health: Market-based models provide remote consultation
or verify drug authenticity
Awareness/ Decision
Monitoring (patient
to seek care/desire
Local delivery of Advanced/special Follow up care cases, regional
for
basic care ized care and long-term health data, drug
primary/preventive
authenticity)
care
Awareness on Best practice info and Advanced care Efficient remote Data to follow
disease advice on locally delivered remotely follow-up patient care in the
⇒Overcoming cultural available remediation (e.g. via telemedicine) ⇒Better results post by patient and in the
taboos measures and/or more sickness/operation aggregate
⇒Avoiding epidemics ⇒Triage care efficiently at ⇒Quicker return to ⇒Creation of dynamic
spread ⇒Understanding of non-local venues work, family, patient records
Information on where more advanced ⇒Treatment of more productive life ⇒Improvements in
patient condition care might be needed serious conditions health budgeting and
⇒Awareness of basic ⇒Savings on ⇒Cost savings from Aggregation of improved spending of
remedial action (unnecessary) trip more efficient care for patients for group scarce resources
to doctors patients, doctors, purchasing ⇒More patients under
⇒Savings on insurance companies,
(unnecessary) trip ⇒Info on options for better care
more advanced care governments, donors ⇒Access to cheaper Verification of drug
to doctors supplies, more and
⇒Best practice to ⇒Info on payment/cost ⇒Ability for scarce more affordable authenticity
resources – doctors,
manage general healthoptions sophisticated
insurance, more ⇒Savings from
(chronic conditions, investment in local spending on fakes
equipment – to be infrastructure
pregnancies, etc) used on more patients, ⇒Improved patient
improving health health
Legend
outcomes
Service provided by ICT
⇒Corresponding Impact on the BoP
Not market based

25. Education: case studies
Learning British English – for the
cost of a cup of Bangladesh tea
Michael Trucano
25

26. BBC Janala: some business aspects (direct access model)
Service Customers
Combination of mobile, internet, TV 3.8 million customers in Bangladesh
and newspaper based language with 6 million paying courses
lessons
Distribution Financials
Direct access $0.02 for 3 min. lesson or cost of
Partners with mobile access to internet
operators, Bangladesh TV Cost efficiency: now at $4 per person
across all platforms
Profit: not yet

27. ICT can play a role before school, at school and after school,
with paying models only for adult education or private schools
Before school At school After school
Monitoring
Designing Designing Training Reaching Attendin Practi-
Learning of perfor-
curriculum content teachers students g classes cing
mance
Classes on Finding Pedagogy Classes via Reporting Using ICT as Quizzes on Reporting
ICT class training video- attendance learning tools mobile grades
⇒More job content ⇒ Better conferences ⇒ Higher ⇒More ⇒Out-of-school ⇒ Real-time
opportunities ⇒ Improved teachers ⇒Enrollment of attendance enjoyable practicing access to
curriculum ⇒Multipli- new students of teachers classes ⇒Higher grades grades for
Classes via fying effect and pupils ⇒Better students
video- Sharing on Mobile ⇒Better understanding Accessing
conferences class students phone based statistics on Interactions classes
⇒Development content courses education with teachers archives
of the course ⇒Teachers ⇒Affordable through ICT ⇒Better
portfolio networking courses ⇒ Teachers understanding
⇒Reaching closer to the
remote areas students’
needs Online
forums
⇒Empowered
students ⇒Student
networking
ICT classes
Legend ⇒ More job
Service provided by ICT opportunities
⇒Corresponding Impact on the BoP
Not market-based

28. Agenda
Our methodology: learning from what works
Rhetoric trumps reality in ICT4D
Financially sustainable models exist in finance and agro-services, to a lesser
extent in health, and not yet in education
Entrepreneurship is key to starting successful services,
while collaboration is key to scaling
28

29. Conclusions
Successes had an entrepreneurial debut:
•Focus on ability and willingness to pay of targeted
clients, not on needs assessed top-down
•Built from the ground-up
and systemic approach (cross-actor, cross-sector)
to reach scale:
•Capture a sufficiently large share of customer
mind and wallet through a related set of services
•Multiple income streams over time, maximizing
revenues
29

30. In education, health, agriculture and financial services,
ICT4D leaders face similar issues to scale
Challenges mentioned by the 15 project leaders interviewed for this study
Policy: 1. Enabling policy (10)
2. Support from government (5)
Internal capacity: 1. Recruiting agents (7)
2. Recruiting internal staff (5)
3. Training workforce (4)
Partnerships: 1. Partnering with MNOs (4)
2. Deepening existing partnerships (3)
Funding: 1. Equity investments (6) (2 for patient capital)
2. Investment in advertising from third parties (2)
Technology: 1. Robustness (5)
2. Usability (3)
Connectivity: 1. Broadband (5)
2. Increased mobile penetration (3)
*
Other requirements mentioned: trust (6), literacy (4),
demographic density (2)
*CKW, Drishtee, eKutir, esoko, mPedigree, MyC4, Narayana
Hrudayalaya Hospital, txteagle considered as social entrepreneurs

31. Recommendations
Focus on problem driven approach
Support existing entrepreneurs, promoting cross-
sector synergies
Create a systemic environment for cross-border
replication
31

32. Public report presents project findings
Report structure:
Sponsor’s Foreword
Hystra Introduction
Acknowledgements
1. About this project: Methodology
2. Executive summary
Leveraging ICT for the BOP 3. The basis for ICT4D: Connectivity
Innovative business models in education, health, 4. The “Direct access” model
agriculture and financial services
5. The “Local agent” model
6. The “Crowd” model
7. ICT4Financial services
8. ICT4Agriculture
9. ICT4Health
10.ICT4Education
11.Socio-economic impact of ICT4D projects
A joint report by Sponsored by 12.Environmental impact of ICT4D projects
13.Conclusion on findings and recommendations
In collaboration with
Appendix
32

33. Thank you for your attention!
Any questions?
For any questions/topics to discuss, arising after
the webinar, do not hesitate to contact me at:
marc.vandenhomberg@tno.nl