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Mobile Payments in Tanzania

NALA



The Situation

Worldwide, an estimated 2.5 billion people do not have access to a bank account. Of those, 77% live on less than $2 per day. Economists agree that access to financial services, such as savings accounts, is a key stepping stone to financial stability, particularly for low-income populations.

Our Universe Begins in Tanzania, East Africa
  • 57 Million People
  • Only 19% of adults have a bank account, this includes double counting, therefore individual unique accounts stand at 11% today.
  • Yet 40% of adults own a smartphone, with smartphone adoption growing by 2% every month.

  • What We Do

    At NALA, we lower the barrier to financial service usage by providing a mobile money solution that is free, convenient, and packed with extensive services. Current mobile money options in Africa charge users a fee of 7% to 30% per transaction, which is completely unsustainable for low-income users. Existing options also operate using a solely text-based interface and require entering as many as 32 digits just to process a single simple transaction. The incumbent providers have no incentive to innovate because they are profiting from this skewed model. We are building a smartphone application that will offer free transactions, free deposits, a modern UI, and added services, such as inventory tracking and sales history, for merchants. We are currently working in Tanzania, where we have the most local expertise, with plans to expand to the rest of Sub-Saharan Africa.

    What we have done to date
  • 6 different prototypes, built and tested on ground with over 449 different users.
  • 4312 email addresses and phone numbers of ‘future users’ who believe in the need we are solving for 7 Banks ready for us to sign on to run pilot on ground with them
  • Electronic money license - currently being processed in Tanzania

  • How You Can Help

    The key reason we are able to offer free services to users is by providing value-added services to merchants for a small charge. Needs-finding research from the Bill and Melinda Gates Foundation and the Financial Services Division in Tanzania found that merchants continue to rely on paper documents for business management and have a strong wish for better digital services, such as inventory management, sales tracking, promotion sharing, etc. Our current offer to merchants focuses on enabling digital payments for customers, and we want to add additional services.

    Level 1: Design
    Many merchants currently manage sales by recording every transaction in a paper log book. They use this tool to manage inventory, track popular items, retain receipts, and view trends. The first goal is to design the interface for viewing this data on a smartphone. Assuming the data are all available digitally, design an interface and tools for a merchant to view the important info. This interface should be accessible to smartphone users with very limited technical experience.

    Level 2: Building the Merchant Smartphone Application
    Implement the business management designs into a smartphone application. Focus first on creating the designs from Level 1 based on data stored online.
    At Nala, the goal of the merchant application is twofold: (1) to process payments from customers, and (2) to provide the value-added management services described in this project. The purpose of Level 2 is to build the management services in a smartphone application and, if time permits, to incorporate these services with the existing merchant payments application.

    Level 3: Machine Learning Algorithms on Merchant Data
    Digital sales records provide the opportunity to do much more than just track day-to-day inventory. Help develop higher-level analytics to offer additional services to merchants. Two examples are pattern searching to identify unexpected trends in sales and also machine learning for credit assessment to merchants. Based on predictions of sales they will make, small loans can help provide merchants with starting capital to expand their business. This phase of the project is open to creative ideas.

    Recommended Skills:
  • Interest in international affairs, international development, and social impact.
  • Experience with Android development is helpful, though not required.
  • Interest in design for mobile applications.
  • Desire and willingness to learn new things, be self-motivated, and work closely with a small team.
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