Cell Phones Vital in Developing World

An unidentified fisherman speaks on his mobile phone on the outskirts of Chennai, India, Wednesday, Jan. 10, 2007. In millions of ways worldwide, cell phones are making it easier for people to earn money, find jobs and do business. In India, fishermen call ahead to ports to see where they can get the best price for their catch. (AP Photo/M. Lakshman) (M. Lakshman - AP)

In India, fishermen call ahead to ports to see where they will get the best deal on their catch. Kenyan farmers check crop prices on a service offered by local provider Safaricom.

In South Africa, cell phones serve as a virtual office for carpenters, painters and other laborers who post their numbers on handwritten signs advertising their skills.

The Philippines has become a global leader in mobile commerce. Since 2000, Smart Communications Inc., the country's largest carrier, has allowed subscribers in its Smart Money program to hold limited amounts of cash in electronic wallets linked to their mobile accounts.

Using their cell phones, members can withdraw cash from their bank accounts, pay for goods and services and transfer money and airtime credit. The phone records all transactions. Overseas Filipinos are even using this service to send money home. While the system is designed with work with financial institutions, subscribers don't need a bank account.

"If your son or daughter is away at school and needs money, this is an easy way to send it to them," says Ramon Isberto, a Smart spokesman.

This kind of application holds promise for the millions in developing countries who have no bank accounts and for whom transferring money can be difficult or risky.

Wizzit, a South African-based company targeting customers without bank accounts, has been offering cell phone-based financial services since 2005.

Vodafone, which is investing heavily in Africa, is partnering with Kenyan affiliate Safaricom and the Commercial Bank of Africa to soon launch M-Pesa, a mobile financial service that allows users to send and receive cash and perform other transactions.

"Financial institutions are realizing that the only way to reach new customers is through mobile networks," says Nick Hughes, head of the mobile payment team at Vodafone.

Expanding mobile networks also brings other economic benefits, experts say. It lures more foreign investment, gives families better access to health and educational information and provides governments with more revenue from licenses and taxes.

Wireless technology has emerged at a fortuitous time for carriers expanding in developing countries because it is so much cheaper and easier to build than fixed-line networks.

Rugged, sprawling Afghanistan, for example, now has 2 million cell phone subscribers and only 20,000 fixed-line phones.