Monday, June 13, 2005
…My heart’s in Accra
Iqbal Quadir at PUSH 2005: "Iqbal found himself challenging some myths about economic development and the poor. Can shared costs overcome the problems of low individual buying power? Can the value of purchasing a productivity tool make it possible for people to “overinvest” in communication technologies, because these technologies can increase income?

What’s the real problem with digital divides in Bangladesh? The lack of other infrastructures. There are no credit checks, rpads for repairmen, banks to collect bills, schools for the children of workers. Grameen Bank looked like a solution to a lot of these infrastructural problems. Would it make sense to put GSM towers within Grameen offices?

Grameen had 1138 branches in Bangladesh, 2.3 million borrowers, 94% female, with $33 million lent per month. The core model - a woman borrows money from the bank, buys a cow, sells the milk and repays the loan. So why can’t a cellphone be a cow?

There was a great deal of skepticism about the idea, so Iqbal moved home and started a company. He eventually convinced Telenor - the Norwegian national telephone company - to help fund the project and provide technical expertise. With Grameen’s distribution and Telenor’s technology, the business has grown radically, and now covers the majority of the nation - it’s by far the largest company in Bangladesh. By 2004, 95,000 women are selling access to phones that they own in 50,000 villages. And Grameen Phone provides $200 million a year to the government in taxes. Net income in 2004 was $125 million. And each phone owner is making about $700 a year, which is an excellent income in Bangladesh.

Iqbal’s lessons:

Governments don’t always need to support the poor. The poor can support the government.

Poor people aren’t a recipient - they’re a resource.

It’s not too expensive to provide services to the poor - the involvement of the poor reduces the cost of services.

Poor people are eager learners because they don’t have the luxury of not learning."

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