Mobile Money Moving Rapidly Ahead in Haiti
Just seven months ago on January 11, CGAP reported that HIFIVE and the Haiti Mobile Money Initiative (HMMI) awarded Digicel and its partner bank Scotiabank, its “First to Market” Award of $2.5 million for “Tcho Tcho Mobile”. It was a very positive piece of news just prior to the ceremonies one day later marking the first anniversary of the earthquake that hit Port au Prince. Established in June 2010 as part of a longer term response to the disaster in an effort to establish long term financial services for all Haitians, HMMI was created by the Bill & Melinda Gates Foundation in partnership with USAID. HMMI, implemented by the USAID project HIFIVE, provides incentives to encourage mobile operators and financial institutions to launch mobile money services.
Here is a follow up on how that legacy is developing. On July 5 HIFIVE awarded mobile operator Voila and their bank partner Unibank the $1.5 million second “First to Market” Award for “Ti-Cash”. With this important milestone completed and others rapidly approaching, mobile money is well on its way to fulfilling the promise of being a “legacy of the earthquake” that was hinted at in this blog in January.
Despite the difficulties in Haiti during 2010 and into 2011 (earthquake, infrastructure destruction, elections and political unrest, cholera epidemic, tropical storms, floods, and gas shortages), the response to HMMI by the mobile operators, technology providers, financial institutions, institutional users, and Haitians has been very positive, with both Tcho Tcho Mobile and Ti-Cash launched before the end of 2010. The next prizes from HMMI are based on the market size reaching the 100,000; 1,000,000; and 5,000,000 transaction milestone levels. HMMI verification activities are underway to confirm that the 100,000 transaction level was passed and there is every reason to believe that the next landmark for 1,000,000 transactions will not be far away.
Driving this growth are some favorable regulatory approaches that have permitted the use of lower KYC “mini” wallets adapted to the difficult ID issues in Haiti, well conceived marketing approaches, and a diversity of product offerings – an aspect that distinguishes mobile money services in Haiti. There is no single “killer” product that has emerged. Instead, fitting in with the diversity that characterizes the country, there are already a wide variety of products including payroll, merchant payments, and G2P that supplement P2P uses. Internal transfers via P2P should gain further strength as the networks’ penetration in the provinces increases.
Innovative uses of mobile money services for humanitarian programs following the earthquake have also helped play a role in the early growth of the services. However, donors in Haiti are increasingly interested in transforming many of their ongoing “non emergency” programs and payments to these platforms. Efforts are underway to pilot the use of these platforms for insurance premium payments, microfinance loan payments, and village banking savings collection, amongst others.
There is much to do before we can claim that mobile money services in Haiti are ubiquitous and sustainable. The problems are familiar: the difficulties and costs of expanding outreach via agent network penetration, the relatively weak retail structure outside of the capital, the need to find the right business model, and the identification of the best ways to drive demand. However, the enthusiastic users of Tcho Tcho and Ti-Cash already accept mobile money services as part of their new, post-earthquake Haiti.