Improving Education with Financial Innovation, Chapter-by-Chapter

We recently spoke with Tonee Ndungu of Kytabu via Google Hangout. Kytabu is a Kenyan-based company that offers a subscription service to core-curriculum text books. With this model, people can pay in small increments for only the content they need - likely just a few individual chapters of a book - via mobile money and read the content on their cell phones.

Kytabu is a new business that has a long way to go but Tonee’s concept has stood out to us as an example of what is possible with education for the poor in the digital world. As Tonee explains: “Not only will poor people pay for textbooks, they are doing it right now…Instead of buying the whole book, they go to middle men who buy the original textbook…photocopy the entire textbook and then sell it in chapters and when they sell it in chapters, it is cheaper than buying the entire book…A lot of parents are buying those because that is what they can afford...So it is already happening and all that Kytabu is doing is… digitizing it.”

We learned about Kytabu through Pivot East, a great competition for start-ups in East Africa. Our view is that education enabled with digital finance is a “white space” that is ripe for innovation. To begin with, there are few known financial products specific to increasing education access for the poor. But interesting innovations could emerge, especially at the intersection of content delivery (MOOCS, Khan Academy, self-directed learning) and financial innovation that makes that educational content affordable for the very poor.