Saturday, June 12, 2010

Mobile Banking

The earth quake in Haiti has had some major repercussions on its people. One of the many challenges that these people are facing right now is how to recreate their lives with little to no money. Funds have been sent to this country to relieve the people from the disaster by governments all over the world, and primarily from the United States. Yet, these acts of charity are not enough to begin rehabilitating the people. “Haitians complained that the politically connected were benefiting most from the scant reconstruction work and that crime was returning,” says the New York Times of the disaster. The discontent that has risen from the Haitian political conspiracies has shown the world that the people of Haiti know they deserve more for their perils.

The response to the people’s requests has come with no strings attached, or no wires attached to be precise. The Bill and Melinda Gates Foundation is donating $10 million to mobile banking technology in Haiti. With this technology the people in impoverished countries can have control over their own money. Prior to the earthquake only 15% of Haitians had bank accounts. This was a minimal amount due to the inaccessibility of the banking system. The earthquake destroyed at least 1/3 of the Banks/ATM’s making it difficult for the small percentage of those who had bank accounts to reach their money.

Mobile banking will make it faster for the people in Haiti to rebuild their lives and eventually improve their style of living. A similar business has been instituted in Kenya called M-Pesa. This company is a brilliant success, and with a growing 40% of the adult population using the system its long term payoffs are improving. “According to the US National Bureau of Economic Research, households with access to savings accounts are more likely to invest in education, will increase productivity and income and are less vulnerable to illness.” The positive effects of Mobile Banking are still growing. Research shows that people who would have normally spent their money will want to save their money since they will not have to worry about cash being stolen from them. After the people’s short needs and fears are put to rest then they may focus on long term goals. Mobile banking will help people aim for these goals.

-Rachel Ulrich