Mobile money aids the unbanked

By Catherine

By Catherine Bolgar*

Mobile money

Imagine paying at a shop by sending a text message from your phone. Or sending money to your child at university in another city with an SMS. Or getting a small loan via your phone.

This futuristic vision of mobile money has been promised ever since mobile phones took off in the 1990s. In most of the developed world, mobile banking means using a phone to do the same kinds of transactions—checking a balance, transferring funds—one would do on a desktop computer. Mobile money hasn’t found footing.

In Kenya and some other developing countries, however, mobile money is widely accepted. The World Bank estimates 2.5 billion people in the world are “unbanked”—without access to formal bank accounts. Mobile money programs offer a bridge toward financial inclusion, not just in developing countries but also for unbanked people such as the poor or immigrants in the West.

In Africa, where people were trying to transfer money from urban to rural areas or across borders, they had to rely on really insecure methods like giving the money to a bus driver to deliver,” says Janine Aron, economics professor at the University of Oxford in the U.K. and author of “‘Leapfrogging’: A Survey of the Nature and Implications of Mobile Money.” “In the West we have secure methods like credit cards, payment cards. People are suspicious of the security of mobile methods.” But in Africa, the mobile methods are more secure than the alternatives.

In Kenya, the biggest mobile phone operator, Safaricom, offers a service called M-Pesa—pesa is Swahili for money. Since its launch in March 2007, M-Pesa has reached 18 million active users among Kenya’s 43 million population.

In poor countries that rely heavily on cash, these services are likely to take off,” Dr. Aron says. Vodafone, which developed M-Pesa with Safaricom, took the mobile money program in March to Romania, after launching it in India last year.

In 2001, there was only one mobile money service for the unbanked, she says. By 2007, there were 11, including M-Pesa. Last year, there were 219, with the biggest growth in Africa.

Mobile money

M-Pesa takes advantage of Safaricom’s dense network of 45,000 agents who sell mobile phone airtime. People go into the Safaricom kiosk to top off their SIM cards. “My SIM card becomes my bank,” explains Sunil Gupta, business professor at Harvard University in Cambridge, Massachusetts. The Safaricom agents thus act as bank tellers handling cash, taking deposits and paying out withdrawals. The kiosks are open early and close late for maximum convenience.

Kenya has two commercial bank branches and about four automated teller machines per 1,000 square kilometers; high-income countries have an average of 28 branches and nearly 75 ATMs per 1,000 square kilometers, according to the World Bank.

The whole service has really helped compensate for the lack of infrastructure,” says David Albertazzi, senior analyst at Aite Group, a market research consultancy in Boston, Massachusetts. “The lack of infrastructure let mobile devices become that infrastructure.”

In addition, Kenyans mostly are using older models of mobile phones. That made the M-Pesa approach different from the fancy user interfaces and responsive Web design that vendors in high-income countries are developing for smart phones and tablets. “In the rest of the world, I don’t care how it looks—I just want to conduct transactions and I want it to be ubiquitous,” Mr. Albertazzi says.

The system continues to evolve. In December 2012, Safaricom partnered with Commercial Bank of Africa to launch M-Shwari, a service with a savings account that bears interest—important in a country with inflation topping 6%—and 30-day loans that can be applied for via SMS. The program is open to M-Pesa users who have had an account for at least six months. Algorithms analyze the customer’s transactions on M-Pesa to substitute for what in the U.S. would be a credit score. M-Shwari already has 2.4 million active users and has collected the equivalent of $21 million.

“It’s tremendously enabling,” Dr. Aron says. “It has reduced transaction costs and reduced risk.”

In the absence of credit information about people who don’t have bank accounts, banks have been reluctant to give loans. The lack of access to credit is a key culprit in Africa’s economic stagnancy—people can’t start small businesses because they don’t have enough savings (in cash) upfront; small businesses can’t get loans to expand. M-Shwari begins to address that situation by making small loans accessible—not only in terms of openness to a population who previously couldn’t get loans through a bank but also in terms of ease of use—a simple SMS.

However, only Kenya, Tanzania, Ghana and the Philippines have mobile financial services adoption rates above 10%, according to the World Economic Forum. Adoption of mobile financial services remains under 1% in some very populous countries, including India, Pakistan, Nigeria and Brazil.

The world’s poor have long been ignored, not just by banks but also by companies and governments, because the cost of reaching them was so huge, Dr. Gupta says, “That’s the next battle to win, for banks and the rest of the private sector.”

*For more from Catherine, contributors from the Economist Intelligence Unit along with industry experts, join The Future Realities discussion.

Architecture, Engineering & Construction: Customized Efficiency

By Akio

The following is a reprint of a Compass: The 3DEXPERIENCE Magazine article written by Vicki Speed.

Customized Efficiency Permasteelisa

The Permasteelisa Group, based in Italy, is a leading worldwide contractor in the engineering, manufacture and installation of architectural envelopes and interior systems.

Compass spoke to Permasteelisa IT project manager Federico Momesso and communication manager Massimiliano Fanzaga about how the company is adopting more standardized technologies and processes to better meet the construction industry’s growing demand for customized building systems on short timelines.

Compass: What challenges do you face in meeting client expectations?

FEDERICO MOMESSO: Every building project is unique, requiring multiple companies – owners, architects, engineers, contractors, subcontractors and suppliers with different skills to come together. It’s a fragmented industry that does not yet apply the same advanced level of 3D modeling to move from concept to completion as other markets, such as the automotive or aerospace industry.

Part of this is because of the inherent differences. In the automotive industry, one design is modeled and reproduced many times; in the building industry, every design is distinctive.

MASSIMILIANO FANZAGA: As well, projects are increasingly complex, as are the shapes of the interior/exterior elements. Even though every project is different, owners, architects and contractors want projects engineered, executed and built much quicker than ever before.

Permasteelisa has the added challenge of adapting its services to meet the needs of a diverse range of customers from different cultures, each with very different expectations, resources and awareness.

What is your most common workflow?

FANZAGA: It has changed considerably over the years. Increasingly, the industry is shifting to an early-stage design review similar to the front-loaded design process in the automotive industry, to improve communication and collaboration between all parties, especially the architect and contractor.

Click to tweet: “#AEC is shifting to improve
communication & collaboration between all parties”

Ideally, we work hand-in-hand with the owner and project team at the earliest onset of design to engineer a technical solution that best meets the needs and budget of the project.


MOMESSO: One of the biggest challenges in developing our technology framework is to find a (3D modeling) solution that is able to work with all the different modeling systems our global customers use.

We must have the ability to capture more information and functionality to shorten lead time, reduce waste and rework and maintain our expectation of high quality. It’s a continually improving process.

How has technology helped meet market demand?

MOMESSO: We’ve relied on virtual design and 3D technology for many years. One of the company’s first applications of 3D modeling was on Frank Gehry’s golden fish sculpture for the 1992 Olympics in Barcelona, Spain. In those early days, the benefits of 3D modeling were primarily internal to Permasteelisa.

Our project engineers and designers relied on the system capabilities for clash detection and quality production checks. Today, Permasteelisa uses the virtual model to communicate and share design concepts with customers as a way to help them visualize design intent and balance costs throughout the process.

FANZAGA: Our strength is our ability to apply the best resources for any job anytime, anywhere to meet the customized requirements of every project. Not that long ago, every one of our 50 offices would have used different CAD and other design technologies and approaches to complete a job.

Today, we’re all speaking the same language thanks to 3D, regardless of geographic location. We have reached a point where all design/engineering are relying on a standardized IT environment, which allows anyone to work on any project at the same time. We’re also finding ways to pre-customize elements or use the same module on multiple projects.

Click to tweet: “Thanks to 3D, the #AEC community is
speaking the same language regardless of geographic location.”

How do you communicate to the installers which piece goes where?

MOMESSO: For every project, we provide detailed work instructions about how to install different modules, as well as installation maps that show the correct installation sequence for each floor/façade.

What if something goes wrong on site?

FANZAGA: Clearly, the world is not as perfect as we would it like to be and some problems can arise on site. In these rare events, our site managers decide the best way to adapt the modules to fit to the concrete structure of the building or, in the worst case, ask for new modules to be produced and shipped onsite. Luckily, those events are very rare!

How are you looking to advance your processes?

MOMESSO: For installation, we have been testing the possibility of using radio-frequency identification (RFID) tags to precisely indicate where each unit has to be installed, which would minimize the risk of an incorrect installation sequence.

We’re also looking to extend the benefits of 3D to our customers and suppliers. Since those early days of 3D modeling in the building industry you can see considerable improvements, especially with the application of Building Information Modeling (BIM). As well, our clients are asking us to deliver solutions that can be connected to their 3D models.

We are currently implementing product lifecycle technologies. They provide a collaboration-based project backbone that enables centralized project management, which helps us to expand our online creation and collaboration capabilities as well as to foster lean construction methods.

Tweet: Architecture, Engineering & Construction Customized Efficiently @3DSAEC @Dassault3DS #AEC to tweet this article:
“Architecture, Engineering & Construction: Customized Efficiency”

Related Resources

Façade Design for Fabrication

Collaborative and Industrialized Construction

The Permasteelisa Group

Internet of Things: What’s the Big Idea?

By Estelle



Internet Of Things

Written by Hong Bai *

Starting from January 2014, right after Google announced its $3.2 Billion acquisition of NEST, the expression “Internet of Things”, known as IoT, has suddenly become the big buzz word in all different industries. Engineers and business leaders are having all kinds of discussion around this area over social media. And some among them did successfully transform their business by creating disruptive innovations based on IoT oriented technologies, such as Parrot or Withings.

However, among all those discussions and successful business cases, there is one question that was never clearly answered: what’s the big idea about internet of things? I think that everyone may have his/her own answer to this question and there does not exist an absolute definition to which we can look upon. I would like to share my own opinions about the true nature of IoT here.

First of all, to understand the term “internet of things”, we have to start with the word “things” that refers to the products that are enabling IoT usages. There are two important features about these products: mobility & connectivity. These two features have already served in many consumer and industry use cases , and their main purpose is: collecting live information from anywhere at any time. This leads us to the second important element of IoT – data.

When you have one device collecting information for you, the outcome of that process is called data. But when you have billions of connected devices that are collecting all different types of information for you, then it will become Big Data. In my opinion, Big Data is the derived content of IoT. Its purpose is to be analyzed in order to better understand the behaviors of systems or consumers. Once companies can identify the patterns and interrelations among different behaviors, which seem to be random or disordered, they can anticipate events or activities that will occur in the near future and build an offer to bring additional value to users. The best way to deliver such additional value is through services.

Service is the third important element of IoT. It is also the most profitable and valuable part of the entire IoT value chain. If product and data are about creating needs, services are usually designed to be the exact solution to satisfy those needs. For instance, if I have a product which collects information about one’s body weight, it will collect a huge amount of data about people’s weight. From those data, I find out that people will start looking for professional advices once their body weight is 30% above the average. It allows bringing fitness services offering to those people to satisfy their needs. This provides an extraordinary user experience to the end consumers.

Now, the answer to my previous question seems to be obvious, the big idea of IoT is to have connected devices collecting data for analysis, and offer exceptional services based on the result of the analysis, to create unique user experiences.

Are you Ready for the Internet Of Things? Join us at Solidworks World 2015 and attend the session “Mechatronics engineering experience for Smart Devices with SolidWorks”  on Monday Feb 9th  from 10.30  to 12.00 pm.

* Hong Bai is the High-Tech Industry Mechatronic System Design Consultant @ Dassault Systèmes. In his role, Hong is working with worldwide  leading Electronics companies to support their key business process transformation initiatives. 

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