Techonomics - Cutting the Ribbon

This post is contributed by Ben Lyon.

TECHONOMICS, a new AshokaTECH Blog series devoted to shining a spotlight on the technologies that are fundamentally altering—and have indeed altered—the financial landscape in emerging markets. From prepaid debit cards to mobile banking and payments, the pace with which information communication technologies (ICTs) are bringing financial services to the previously unbanked is staggering.

Before jumping into a particular technology, though, it's important to step back and ask “Why do ICTs matter?” Put simply, the operative word in the acronym is information. Information allows us to know the market value of a good or service, avoid manipulation, determine whether or not a journey is worth our time, educate ourselves, and so on. The more information we have, the better positioned we are to make the best decisions and receive the greatest benefits.

When one party in a transaction knows more than the other, an 'information asymmetry' occurs. That is, the more knowledgeable party can—and has every incentive to—take advantage of the less knowledgeable party.

Image source: kiwanja.net

Whether CellBazaar in Bangladesh, eSoko in Ghana, Trade at Hand in Liberia, or Zain Info Services throughout Africa and The Middle East, ICT services are popping up at lightning speed to meet the demand for information outlined above. By simply typing a text message command or thumbing through an interactive menu on a mobile phone, millions of people in emerging markets now have a range of information at their fingertips. Making that information universally accessible should be the paramount mission of ICT practitioners worldwide.

the phrase “Knowledge is Power!” is deeply engrained in our psyche. Knowledge disrupts hierarchies, fosters understanding, insulates us from abuse and generally levels the playing field. Due in large part to an influx of accessible ICTs, an information revolution is sweeping the emerging world. Where and to what extent this revolution promotes financial inclusion will be the subject of future posts.