Bitcoin Forum
December 09, 2016, 03:59:32 AM *
News: To be able to use the next phase of the beta forum software, please ensure that your email address is correct/functional.
 
   Home   Help Search Donate Login Register  
Pages: [1] 2 3 »  All
  Print  
Author Topic: Mobile money slowly turning East Africa into cashless society  (Read 7385 times)
istar
Hero Member
*****
Offline Offline

Activity: 524


View Profile
February 13, 2012, 08:22:40 AM
 #1

http://mobilemoneyafrica.com/mobile-money-slowly-turning-east-africa-into-cashless-society/

Mobilemoney Africa summit: Someone from Bitcoin should go there...
http://mobilemoneyafrica.com/mobile-money-event/

"A frequent comment I hear, particularly from international banks, is that the unbanked aren’t for them."
http://www.mobilemoneyconsulting.com/2011/09/21/uncategorized/sibos-have-banks-missed-the-mobile-payments-boat


Bitcoins - Because we should not pay to use our money
1481255972
Hero Member
*
Offline Offline

Posts: 1481255972

View Profile Personal Message (Offline)

Ignore
1481255972
Reply with quote  #2

1481255972
Report to moderator
1481255972
Hero Member
*
Offline Offline

Posts: 1481255972

View Profile Personal Message (Offline)

Ignore
1481255972
Reply with quote  #2

1481255972
Report to moderator
1481255972
Hero Member
*
Offline Offline

Posts: 1481255972

View Profile Personal Message (Offline)

Ignore
1481255972
Reply with quote  #2

1481255972
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
anu
Legendary
*
Offline Offline

Activity: 938


P2P Everything


View Profile WWW
February 13, 2012, 02:31:57 PM
 #2

What do you think about using Bitcoin's deflationary properties to push capital into Africa:
http://bitcoinmedia.com/our-next-adoption-phase/?


Zero Reserve - A distributed Bitcoin Exchange

Install - Getting Started - BitcoinTalk Thread - Github Source
kjlimo
Legendary
*
Offline Offline

Activity: 1498


View Profile WWW
February 13, 2012, 02:44:55 PM
 #3

Africa is certainly prime for the picking.  Mobile SMS text messaging money transfers are the norm over there.

Bitcoin could certainly make a splash. 

CampBX for buying BTCs, Coinbase for selling BTCs or Vircurex or Cryptsy for trading alternate cryptocurrencies like DOGEs

PM me with any questions on these sites!  Happy to help!

Bitcoin Poker at Seals                  Strike Sapphire Casino  Free games every hour & day!
  Get Free Bitcoins here.

Spondoolies-Tech or KnC Miner for the fastest mining hardware available!

Bitpay to help your business accept bitcoin payments!
conspirosphere.tk
Legendary
*
Offline Offline

Activity: 1862


Revolution will be decentralized


View Profile WWW
February 14, 2012, 07:47:38 PM
 #4

Africa is certainly prime for the picking.  Mobile SMS text messaging money transfers are the norm over there.
Bitcoin could certainly make a splash. 

Meh. Internet is a whole different story. In Ethiopia for example all the telecom is monopolized by the evil gov't, which is doing its best (effectively) that internet do not work at all there.  I wonder what is the point of all those internet cafe in Addis. I suppose just to meet ppl in person or as a cover for some other biz.

Paul Troon
Member
**
Offline Offline

Activity: 63



View Profile
March 22, 2012, 09:12:59 PM
 #5

Africa is certainly prime for the picking.  Mobile SMS text messaging money transfers are the norm over there.

How does Mobile SMS money transfer work in Africa?  There must be some gateway to an account entry system for that to work.  A gateway to initiate and verify Bitcoin transactions should be possible in the same way.  That would enable Bitcoin payment with out local access to the internet.  You would lose some decentralization by using a gateway, but there could be competition among gateways.   I also assume transactions would be denominated in BTC, otherwise there would have to be some way to determine the current exchange rate with local or international fiat currency.

I can image a scenario like the following (assumes an android device):

1) person 1 wants to pay person 2 in BTC
2) person 2 generates a public address on their phone and sends it to person 1 (via bluetooth, camera scan, local wifi, etc.)
3) person 1 generates signed transfer from their wallet to person 2's public address and sends it to person 2 (via bluetooth, camera scan, local wifi, etc.)
4) person 2 verifies terms of the transfer and sends an SMS with the signed transfer to the Bitcoin gateway
5) the Bitcoin gateway posts the signed transfer to the Bitcoin network and waits for some predetermined number of confirms or rejections
6) the Bitcoin gateway sends an SMS to person 2 saying the transfer succeeded or failed

- The BTC gateway operator will incur internet and SMS network fees and will demand some sort of micropayment, perhaps in BTC, for each transaction cleared. 
- The BTC gateway could run on an android phone sitting somewhere with more reliable wifi access.
- An African Bitcoin ecosystem would also need someone willing to exchange Bitcoins for local fiat currency (and/or foreign currency).

I also wonder if the user side could be implemented using SIM toolkit (like M-Pesa) on non-android phones.  That would instantly increase it's penetration.


Bitrated user: paultroon.
bitlotto
Hero Member
*****
Offline Offline

Activity: 672


BitLotto - best odds + best payouts + cheat-proof


View Profile WWW
March 22, 2012, 10:39:57 PM
 #6

I can see BTC really thriving in parts of the world that don't have as much infrastructure already set up. You can bypass corrupt regimes ruining your local currency and pay for things easily knowing that you'll still have something of value no matter what is happening locally.

*Next Draw Feb 1*  BitLotto: monthly raffle (0.25 BTC per ticket) Completely transparent and impossible to manipulate who wins. TOR
TOR2WEB
Donations to: 1JQdiQsjhV2uJ4Y8HFtdqteJsZhv835a8J are appreciated.
stochastic
Hero Member
*****
Offline Offline

Activity: 532


View Profile
March 22, 2012, 10:49:18 PM
 #7



How does Mobile SMS money transfer work in Africa? 

I think it is as simple as the seller requesting a portion of the buyers prepaid phone amount to be debited and sent to the merchants account.

Introducing constraints to the economy only serves to limit what can be economical.
Mike Hearn
Legendary
*
Offline Offline

Activity: 1526


View Profile
March 26, 2012, 02:46:13 PM
 #8

The system used in Africa is based on the GSM standard that lets the operator put simple menus on the users screen:

http://en.wikipedia.org/wiki/Unstructured_Supplementary_Service_Data
Paul Troon
Member
**
Offline Offline

Activity: 63



View Profile
March 26, 2012, 04:42:15 PM
 #9

The system used in Africa is based on the GSM standard that lets the operator put simple menus on the users screen:

http://en.wikipedia.org/wiki/Unstructured_Supplementary_Service_Data

Sounds like they use USSD and the SIM toolkit for the M-Pesa system.  Unfortunately any cell operator based system requires the operator and thus also the the government to support it.  An ideal system would bypass as much as possible any requirement for government or big business support.

I've been thinking of how you could do SMS based Bitcoin transactions with low cost hardware (ie. no smart phones/internet) and still be secure; I think you could do it all with two SIM cards.  One SIM card could be from the operator and thus have the ability to send/receive simple SMS messages.  A second SIM card could be independently produced that acts as a Bitcoin wallet and contain SIM Toolkit software necessary to communicate with a Bitcoin SMS gateway to create transactions and check for confirmations.    This second SIM card would not have any ability to log into the cell providers network, but should be able to check and queue up SMS messages in the phone's memory.

Programming for SIM toolkit is a PITA, but simulators are available so a proof of concept wouldn't be too hard to produce.

Bitrated user: paultroon.
Otoh
Donator
Legendary
*
Offline Offline

Activity: 1918



View Profile
March 26, 2012, 08:20:26 PM
 #10

The system used in Africa is based on the GSM standard that lets the operator put simple menus on the users screen:

http://en.wikipedia.org/wiki/Unstructured_Supplementary_Service_Data

Sounds like they use USSD and the SIM toolkit for the M-Pesa system.  Unfortunately any cell operator based system requires the operator and thus also the the government to support it.  An ideal system would bypass as much as possible any requirement for government or big business support.

I've been thinking of how you could do SMS based Bitcoin transactions with low cost hardware (ie. no smart phones/internet) and still be secure; I think you could do it all with two SIM cards.  One SIM card could be from the operator and thus have the ability to send/receive simple SMS messages.  A second SIM card could be independently produced that acts as a Bitcoin wallet and contain SIM Toolkit software necessary to communicate with a Bitcoin SMS gateway to create transactions and check for confirmations.    This second SIM card would not have any ability to log into the cell providers network, but should be able to check and queue up SMS messages in the phone's memory.

Programming for SIM toolkit is a PITA, but simulators are available so a proof of concept wouldn't be too hard to produce.

any NPO, or individuals willing to set one up, looking to move this concept or other possible solutions forward then please to see my thread re potential funding for the research, development, & implementation of this

https://bitcointalk.org/index.php?topic=68162.0;all

all I can say is that I believe it would receive a sympathetic hearing from someone who could offer realistic backing to potentially make it happen

Node40.com is a leader in DASH hosting, dedicated exclusively to fully managed masternode hosting. Professional, organized, and responsive. I have many dozens of nodes with them.    
BTC = $c²     BTC = 1otohotohMoQoxHuxLBveQiZcV3Pji3Tc      DASH, Digital Cash = www.dash.org   
   CHARITY | MY REP | DICE
repentance
Hero Member
*****
Offline Offline

Activity: 840


View Profile
March 27, 2012, 12:46:22 AM
 #11

The system used in Africa is based on the GSM standard that lets the operator put simple menus on the users screen:

http://en.wikipedia.org/wiki/Unstructured_Supplementary_Service_Data

Sounds like they use USSD and the SIM toolkit for the M-Pesa system.  Unfortunately any cell operator based system requires the operator and thus also the the government to support it.  An ideal system would bypass as much as possible any requirement for government or big business support.

I've been thinking of how you could do SMS based Bitcoin transactions with low cost hardware (ie. no smart phones/internet) and still be secure; I think you could do it all with two SIM cards.  One SIM card could be from the operator and thus have the ability to send/receive simple SMS messages.  A second SIM card could be independently produced that acts as a Bitcoin wallet and contain SIM Toolkit software necessary to communicate with a Bitcoin SMS gateway to create transactions and check for confirmations.    This second SIM card would not have any ability to log into the cell providers network, but should be able to check and queue up SMS messages in the phone's memory.

Programming for SIM toolkit is a PITA, but simulators are available so a proof of concept wouldn't be too hard to produce.

Unless people are using dual SIM phones, this is going to be a pain in the ass.  SIM cards are small and easily lost and swapping out SIM cards is a nuisance in many phones.  A lot of pre-paid phones are also locked to particular networks and will only accept SIM cards from those networks - you'd need to either configure existing cards issued by the network or people would need to get their phones unlocked.

There's a limit to how much trouble people will go to in order to make transactions.  You also need to look at what the effective fees on microtransactions would be.  The infrastructure with which the second SIM communicated would not be free, but it would need to be affordable - how do you make it affordable if you're not using the towers of existing providers to route communication with the Bitcoin SMS gateway?


All I can say is that this is Bitcoin. I don't believe it until I see six confirmations.
Paul Troon
Member
**
Offline Offline

Activity: 63



View Profile
March 27, 2012, 05:43:57 PM
 #12

Unless people are using dual SIM phones, this is going to be a pain in the ass.  SIM cards are small and easily lost and swapping out SIM cards is a nuisance in many phones.  A lot of pre-paid phones are also locked to particular networks and will only accept SIM cards from those networks - you'd need to either configure existing cards issued by the network or people would need to get their phones unlocked.

I agree with you about swapping SIM cards being a pain and also that unlocked phones would be required.   This is far from a perfect solution, and dual SIM phones are rare and can not be assumed.   My goal would be a solution that would work with out a major investment in new phone technology by the user. 

Unlocking phones is a mature cottage industry so I'm not too worried about that, but the dual SIM swapping is unavoidable.  People swap SIMs all the time to save money when traveling by using a local pre-paid GSM card.  It's not elegant, but it could work.

There's a limit to how much trouble people will go to in order to make transactions.  You also need to look at what the effective fees on microtransactions would be.  The infrastructure with which the second SIM communicated would not be free, but it would need to be affordable - how do you make it affordable if you're not using the towers of existing providers to route communication with the Bitcoin SMS gateway?

I think you missed my point about why two SIMs would be required.  The first SIM would be from a local cell carrier and provide the SMS infrastructure for communicating with the Bitcoin gateway via SMS.   The second SIM card would not provide any telecommunications at all and would only be programmed to act as a Bitcoin wallet and to facilitate transactions via SMS messages sent using the first SIM card.

So to your question about costs, they would not be zero.  At a minimum the costs would include:

1) cost of an SMS to the Bitcoin gateway to initiate a transaction
2) cost of an SMS from the Bitcoin gateway to notify that the transaction confirmed
3) cost charged by the gateway to perform the Bitcoin gateway functionality

Creating a payment address and checking your bitcoin balance would all be handled locally using the 2nd Bitcoin card so no costs for that.  If you need to check an exchange rate, that would also require an SMS message and reply.


Bitrated user: paultroon.
cypherdoc
Legendary
*
Offline Offline

Activity: 1764



View Profile
March 27, 2012, 05:48:51 PM
 #13

People swap SIMs all the time to save money when traveling by using a local pre-paid GSM card.  It's not elegant, but it could work.


can u tell me how this works?  my son is travelling to Southeast Asia this summer but the only GSM old phones we have are Blackberry's.  is it possible to stick a prepaid local SIM card in it and have it function for him there?  the problem i'm thinking is that BB's require internet access don't they so how would that effect things?
Mike Hearn
Legendary
*
Offline Offline

Activity: 1526


View Profile
March 29, 2012, 03:39:04 PM
 #14

Cheap Android phones are starting to take over even in Africa. I tried the Bitcoin Wallet app on a phone being sold in Kenya for about $80, it worked fine.

By the time Bitcoin has become big/interesting enough to make real headway in poorer countries the concept of a non-smart phone won't exist. As Apple is unlikely to ever make a real assault on the low end of the market, I think almost all of these devices will be cheap Chinese-manufactured Androids, which is perfect for us.
Paul Troon
Member
**
Offline Offline

Activity: 63



View Profile
March 29, 2012, 04:51:04 PM
 #15

Cheap Android phones are starting to take over even in Africa. I tried the Bitcoin Wallet app on a phone being sold in Kenya for about $80, it worked fine.

By the time Bitcoin has become big/interesting enough to make real headway in poorer countries the concept of a non-smart phone won't exist. As Apple is unlikely to ever make a real assault on the low end of the market, I think almost all of these devices will be cheap Chinese-manufactured Androids, which is perfect for us.

Thanks Mike - that's good to know.  The more I think about it, the concept of a STK+SMS based system, while possible, is too cumbersome to be readily adopted.

Perhaps the real problem with introducing Bitcoin in Africa (or any other developing economy) is to identify the killer application that will motivate people to give it a try.  The only really compelling application I've heard of would be remittances from abroad.  I have read that currently those with out bank accounts must rely on Western Union and pay up to a 20% transfer fee.

Brass tacks - how could Bitcoin compete with Western Union as a remittance service?  Using Kenya as an example, here is a standard business model:

- Establish a formal money transfer company that conforms to all legal requirements and pays required business fees (one time and ongoing). 
- Accept Bitcoins from Kenyan customers via a retail establishment in exchange for Kenyan Shillings. 
- Bitcoins that are received are exchanged for USD via international Bitcoin exchanges.
- Proceeds from the exchanges flow back to Kenya via standard interbank transfer and are converted to Kenyan Shillings to fund future payments.

The big question is whether or not that business model would result in reducing the 20% transfer fee that Western Union charges.

A non-standard business model might look something like this:

- Person A, who has a bank account, advertises their willingness to exchange Bitcoin for Kenyan Shillings.
- Person B, who does not have a bank account, receives Bitcoins from a relative abroad.
- Person A meets person B, face to face, and exchanges Kenyan Shillings for Bitcoins via an Android application.
- Person A exchanges Bitcoins that are received for USD via international Bitcoin exchanges.
- Proceeds from the exchanges flow back to Person A's bank account via standard interbank transfer and are converted to Kenyan Shillings to fund future payments.

If trust were established between Person A and person B, then the cash for Bitcoin exchange could also proceed via an exchange of SMS messages and an M-Pesa cash payment.   The smaller the amount of value that was exchanged, the less trust that would have to exist to facilitate remote exchanges.

One thing to note, inflation in Kenya (for example) was around 17% last year.   That means that holding Kenyan Shillings in a bank account that isn't paying at least 17% APR is a bad idea.  Hedging against inflation might explain why Western Union charges such a high fee to exchange dollars for Shillings. 

The killer application for Bitcoins in Kenya and other developing economies might ultimately be as a non-inflationary store of value.

Bitrated user: paultroon.
DublinBrian
Full Member
***
Offline Offline

Activity: 197


View Profile
March 29, 2012, 08:44:17 PM
 #16

Its hard for Bitcoin to compete in Africa with free smart phones

Quote
Western Union and MTN also announced today that they will provide 9,000 branded mobile “Yellow Phones” to Ugandans. Customers who receive these phones must already have an active MTN Mobile Money account or sign up for one in order to use the new remittance service. The phones will be given away via ongoing promotions throughout Uganda over the next few months.
http://pymnts.com/news/businesswire-feed/2012/march/28/western-union-mtn-announce-launch-of-mobile-money-transfer-service-in-uganda-provides-9000-branded-mobile-phones-20120328005318/
rjk
Sr. Member
****
Offline Offline

Activity: 420


1ngldh


View Profile
March 29, 2012, 08:55:12 PM
 #17

Its hard for Bitcoin to compete in Africa with free smart phones

Quote
Western Union and MTN also announced today that they will provide 9,000 branded mobile “Yellow Phones” to Ugandans. Customers who receive these phones must already have an active MTN Mobile Money account or sign up for one in order to use the new remittance service. The phones will be given away via ongoing promotions throughout Uganda over the next few months.
http://pymnts.com/news/businesswire-feed/2012/march/28/western-union-mtn-announce-launch-of-mobile-money-transfer-service-in-uganda-provides-9000-branded-mobile-phones-20120328005318/
Well, if they are android phones, that just gives them a free way to run a bitcoin app. Even though the phone will be free, I'll bet that the transaction fees won't be waived for WU payments. So now that they have a phone, load it up with bitcoin and start trading with close to zero fees. Win!

Mining Rig Extraordinaire - the Trenton BPX6806 18-slot PCIe backplane [PICS] Dead project is dead, all hail the coming of the mighty ASIC!
Stephen Gornick
Legendary
*
Offline Offline

Activity: 2002



View Profile
March 29, 2012, 11:28:36 PM
 #18

Cheap Android phones are starting to take over even in Africa. I tried the Bitcoin Wallet app on a phone being sold in Kenya for about $80, it worked fine.

Smartphones are now at 50% penetration in the U.S. (with 2/3rd of all new phones sold being smartphones as well):



 - http://www.businessinsider.com/chart-of-the-day-smartphone-penetration-2012-3

Well, if they are android phones, that just gives them a free way to run a bitcoin app. Even though the phone will be free,

What I am concerned with is "the Linode problem".  All these mobiles are managed devices.   They can be fully controlled by someone other than the owner of the device.  Yes, they are managed by the carrier but possibly that carrier has people that cannot be trusted or, just as bad, has people who don't maintain secure systems themselves such as what reportedly is what happened at Linode.

The importance is thiis.  An attack that defrauds M-Pesa's customers en mass means Safaricom figures out at some point that there's a problem, halts all affected systems to prevent further losses, and in the end eats some, most or all of the customer's losses.  A similar attack through the managed services of the mobile network to steal bitcoins from mobiles means just that the individual mobile user alone loses out.  Just like how Linode disavowed any responsibility to Slush, Bitcoinica, etc. for the tens of thousands of bitcoins lost, Safaricom would likely maintain the same position.

So, this is a fundamental question -- is the practice of storing bitcoin private keys on the mobile something that exposes it to too much risk to where it shouldn't even be considered?  i.e., bitcoin apps for mobile need to be under the same model that mobile banking (like M-Pesa) uses?

Stephen Gornick
Legendary
*
Offline Offline

Activity: 2002



View Profile
April 29, 2012, 10:33:47 AM
 #19

Fairly short article in the Economist (well, short for the Economist):
 
Quote
One business where the poorest continent is miles ahead

There were 20 countries in which more than 10% of adults say they used mobile money at some point in 2011.

Of those, 15 are African.

In Kenya, Sudan and Gabon half or more of adults used mobile money.

Most mobile-phone transactions are tiny. Market traders, for example, use mobile phones to pay peasant farmers for a single bag of cassava or maize-meal. One of the most successful mobile-phone products in Kenya is a SIM card costing just a few cents—but that is all people need for the occasional transaction.

Mobile phones are also used to bank remittances from family members abroad.  This may explain why mobile money has done so well in Somalia, a country which barely has a government, but where a third of adults said they used mobile money last year. Somalia is one of the countries that most depends on remittances: one study found that 80% of the capital for start-up firms came from the diaspora

 - http://www.economist.com/node/21553510?fsrc=scn/tw/te/ar/press1formodernity

Otoh
Donator
Legendary
*
Offline Offline

Activity: 1918



View Profile
June 02, 2012, 09:50:34 PM
 #20

NYT article on the international money transfer business atm, ie WU $10 fee to send $50 = 20% & a rip off exchange rate on top of that too

http://www.nytimes.com/2012/06/02/business/new-rules-for-money-transfers-but-few-limits.html?_r=1

Node40.com is a leader in DASH hosting, dedicated exclusively to fully managed masternode hosting. Professional, organized, and responsive. I have many dozens of nodes with them.    
BTC = $c²     BTC = 1otohotohMoQoxHuxLBveQiZcV3Pji3Tc      DASH, Digital Cash = www.dash.org   
   CHARITY | MY REP | DICE
Pages: [1] 2 3 »  All
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!