Credit Access in the Democratic Republic of Congo

The Democratic Republic of Congo (DRC) is a country ripe with investment opportunities mainly due to its abundant natural resources, population size and predominantly open trading system. At the same time, it is also a challenging country for business because of its weak financial system, widespread corruption and bribery.

Overall, credit access in the Democratic Republic of Congo is limited, therefore the country has a scarce and short-term credit volume history.

Financial System in the Democratic Republic of Congo

The Congolese financial system has less than 10 licensed banks, one single development bank, 120 microfinance institutions and has no equity or debt markets. The lack of a substantial financial sector prevents the Congolese from participating in the global market. The government of the Democratic Republic of Congo (GDRC) is working to improve and enhance regulatory measures over its economic environment.

The GDRC’s National Agency for Investment Promotion (ANAPI) is responsible for monitoring initial investments that have a value larger than $200,000. ANAPI is required to make the investment process streamlined and transparent for new foreign investors with the goal of improving the country’s image as an investment destination. The GDRC has enacted investment regulations to prohibit foreign investors from conducting business in small retail commerce. These regulations also prohibit a foreign investor from becoming a majority shareholder in the agricultural sector.

Partnership for Financial Inclusion

The Constitution of the Democratic Republic of Congo contains laws meant to combat internal corruption, bribery and the illegal activities of all Congolese citizens. Unfortunately, these laws are rarely enforced, and when they are observed, the application is politically motivated. The corruption negatively impacts the country’s exports and the economy as it discourages foreign investors. In 2013, the IMF withdrew a $532 million loan because the GDRC refused to disclose details surrounding the sale of 25 percent of a state-owned copper project. Without foreign direct investment (FDI), job growth remains stagnant and low wages remain, resulting in the inability to get credit. All of the issues contributing to the fragile state of credit access in the Democratic Republic of Congo can be rectified with innovation and reformation.

The GDRC’s push for advancement is not lost on some U.S. investors, evidenced by the Partnership for Financial Inclusion, a $37.4 million joint venture between the International Finance Corporation (IFC) and the Mastercard Foundation that focuses its interests on financial inclusion in sub-Saharan Africa. The initiative aims to expand microcredit and develop digital financial services that are present now in the DRC, as many of the country’s banks are using mobile services.

Credit Access in the Democratic Republic of Congo

According to the World Bank, current statistics show the strength of legal rights index for the DRC to be six on a scale from zero to 12. This score indicates how the GDRC’s collateral and bankruptcy laws protect borrowers and lenders. The country has no electronic infrastructure listing debtors’ names and wages and lacks any unified registry. In DRC, there are no established rules that work on behalf of its citizens to make it easy to establish credit access. The depth of credit information index shows the DRC ranks zero on a scale of zero to eight. This index measures rules that affect the quality of available credit information and its accessibility to credit bureaus.

The World Bank’s statistics show that within the DRC’s economy, an integrated legal framework for secured transactions exists. However, this framework is a one-stop shop where interagency communication and transactions occur in non-digital systems. This framework is comprised of governmental agencies that expedite registration of DRC companies. A digital infrastructure could allow for a much more fluid and rapid increase in the establishment of digital financial services.

Digital financial services include cryptocurrency and blockchain technology. Cryptocurrencies are digital or virtual money that use encryption to safeguard, regulate and verify the currency and transfer of funds. Cryptocurrencies are not subject to commercial or governmental control and remove corruption from the equation by preventing illegal facilitation payments. Virtual currencies are the foundation for digital economies and financial inclusion. They can reform the Congolese banking system and fund areas such as health care and education.

A digital economy can pave the way for improved personal savings and increased credit access in the Democratic Republic of Congo. According to a study about the impact of digital financial inclusion on inclusive economic growth and development, individuals in rural areas who regularly save their money have more of an ability to feed their families. Results also show they feel socially included with the use of digital services or agent banking, which is not the case with traditional banks.

A nominal percentage of the DRC population has accounts with traditional banks, but thanks to the Partnership for Financial Inclusion, that reality is changing. The country’s goal of expanding microfinance and developing digital services throughout the DRC is slowly actualizing, as is evident by the GDRC’s economic governance of its business climate. It also is evident by their scores for the strength of legal rights index and depth of credit information index.

Because of these scores, the range of credit access in the Democratic Republic of Congo widens, but the country’s laws and corruption still are hurdles that must be overcome in order for the credit access and credit volume to reach ideal numbers.

– Julianne Russo
Photo: Pixabay

How Technology Transforms Agriculture

Smallholder farmers and their families make up to almost 75 percent of the world’s poor population. Struggling with access to health care, clean drinking water and education are just some of the daily challenges these people face. A digital technology company called Ricult is striving to improve the productivity and profitability of smallholder farmers in developing countries by solving agricultural problems with technology-based solutions. Ricult has already helped 10,000 farmers across Thailand and Pakistan and continues to prove that technology transforms agriculture in developing countries every day.

Technology Transforms Agriculture

Ricult requires farmers to enter in their geo-coordinates through their app. It then uses geospatial data streams that monitor the environment through weather, satellite, and soil analytics. This provides the farmer with valuable data such as soil conditions to ensure optimal growth.

Some of the basic problems that poor farmers face include inadequate access to weather data, no pest attack forecast, storage issues, low-profit margins and credit access. According to Usman Javaid, the CEO of Ricult, the biggest reason why microfinance institutions haven’t been able to alleviate poverty in developing markets is that they only focus on one part of the problem by providing credit.

The Work of Government of Pakistan

Providing credit is the main way the Government of Pakistan seeks to transform agriculture. The government has adopted a long-term development strategy that aims to remodel the country into an upper middle-income country by 2025. The government developed the Five Year Plan that aims to ensure national food security and reduce rural poverty by increasing productivity, competitiveness and environmental safety. Through this program, the government provides $3 billion in subsidies, grants and loans. They are also providing credit to farmers who own up to 12.5 acres of land and are facing massive irrigation costs.

Ricult as Example how Technology Transforms Agriculture

Javaid says that one of the biggest problems in developing countries is that when farmers receive cash, they will use it for anything and everything but not for agriculture. The country gives an in-kind loan of inputs delivered to the doorstep of the farmers and accompanies this with insightful and actionable agronomic data from optimal sowing times to yield forecasts. This is just one of the examples of how exactly technology transforms agriculture.

Another great component about Ricult is that it allows farmers to get paid within 48 hours. Farmers generally use a middleman who delivers produce from the farm to the markets. Middlemen often stagger payments and cost additional input. Ricult offers five times lower interest rates than middlemen. Ricult has received a $100,000 grant from the Gates Foundation and continues to transform agriculture in developing countries by making a positive impact in the lives of farmers.

A Pakistani farmer named Faraz Shah has said that the current system of informal credit was not working for the farmers. They were very upset, but Ricult has greatly improved their lives by offering credit at much cheaper prices and improving them with high-quality products. Thailand farmer BubpaWorawat said that Ricult dashboard with its color coding system lets him know in which part of his land growth is stunted so he can take immediate action unlike before when he could not personally scout the areas and he would not know about the problem until it was too late.

Ricult is only one example of how does technology transforms agriculture. Since agriculture is a prevalent way of life in less developed countries, in which most of the poor people of the world live, it is very important to develop the new ways and to use technology to help these people to be more effective in their line of work. By doing so, technology can help poor people get out of the cycle of poverty.

– Grace Klein

Photo: Flickr

Good Uses of AI and Drones in the Fight Against Poverty

Technology is neither inherently good or bad; it is, rather, humanity’s use of technology that can be considered as evil or virtuous. Certain modern tools have the reputation for being capable of carrying out despicable deeds and are, therefore, surrounded by controversy. Artificial intelligence and drones are two of the most widely commentated on and feared applications of modern science. Despite this prevailing negative perception, combatting poverty is happens to be one of the good uses of AI and drones.

Drones Revealing Inequalities

Drones, or UAVs (unmanned aerial vehicles), are often used in violent attacks and warfare, but they, along with their human operators, are also doing wonderful things across the world. Photographer Jonny Miller used drones to capture cities and show the line dividing the rich and the poor.

He captured images of lush, green golf courses directly up against dirt roads and shack neighborhoods. You can see giant mansions with trees and acres of grass next door to brown areas with buildings squished into a small plot. Miller’s project “Unequal Scenes” is raising awareness about poverty and inequality, which would be impossible without drone photography.

Drones Mapping Land

Another way that drones are helping alleviate poverty is through land mapping. More than half the world’s population, usually women, cannot prove they own their land. This is especially problematic in Kosovo where most of the men and boys were murdered during the Balkan wars in the late 90s. The women who remained have worked tirelessly to rebuild their homes and their communities. One enormous roadblock is their inability to use their vast land resources to provide for themselves economically.

These women do not have any sort of documentation for their lands once owned by their husbands. One woman explained that she had applied for loans to build her business, but she was repeatedly turned down because she lacked “property documents to put down as a guarantee.” These communities do not have the means to hire the land surveyors necessary for official registration. Property owners with potentially good, profitable land are powerless without official documentation for their land.

However, drones are helping these women. The World Bank Group’s Global Land and Geospatial unit dispatch drones to map out land plots for a fraction of the cost of traditional land surveyors, giving the Kosovan women the ability to register their lands and ultimately invest in their own property.

AI for Safety and Health

Artificial intelligence (AI), also referred to as “machine learning,” is the “capability of a machine to imitate intelligent human behavior.” It’s often associated with movies about robots destroying humanity that are based on the real fear that one day these machines will become self-aware and grow tired of serving humanity. “The development of full artificial intelligence could spell the end of the human race,” warned Stephen Hawking in 2014. Despite this destructive potential of AI, in the real world, it is currently transforming agriculture and changing businesses in Africa.

One article argues that Africa is amid the “fourth industrial revolution … ushered in by the power of AI.” Many innovative African business leaders have embraced AI to improve productivity and efficiency. One example is the Moroccan company Casky that uses AI to perform analytics on data sent from devices on motorcycle helmets. This has been improving riding habits and providing more accurate insurance premiums, reducing costs and improving safety for riders.

One Algerian firm helps local doctors provide cancer detection and treatment for their patients. The AI creates models that can diagnose those who are unable to visit hospitals for formal examinations. This has the potential to save many lives of those who don’t have the means to get regular checkups and screenings.

AI Helping Businesses

Another instance showing the advantages of AI is the reduction of consumer costs from companies like Niotek in Egypt. This company used AI to improve service quality and reduce the likelihood of human error. AI is also reducing overall costs for farmers and helping to improve their yields in India where RFID tags are being used in dairy cows to provide important information about the cows’ diets and overall health. The information is then stored in a “cow cloud” where it is “AI-analyzed.” The farmers receive alerts about any potential issues or if a cow requires their attention. This can reduce costs and increase efficiency for the farmers.

These are just a few of the many examples of good uses of AI and drones.  They have been especially useful in the fight against poverty. Cases like these prove that technology cannot be inherently evil and that there are good uses of AI and drones. While some individuals may want to use modern equipment to destroy the world, there are plenty of people looking to use the same tools to improve the world.

Photo: Flickr

How Technology is Reducing Poverty in Thailand

Thailand, Southeast Asian Nation, is a country that has benefited from programs that use technology to help people living in poverty. There are several examples as to how technology is reducing poverty in Thailand, and some of them are going to be presented in this article.

Internet Centres

International Telecommunication Union (ITU) and the National Broadcasting and Telecommunications Commission (NBTC) of Thailand have established more than 20 rural internet centers nationwide. NBTC-ITU Volunteers programme built this network, and each of the over 20 centers is equipped with at least 10 computers connected to the internet. The centers, located in 16 provinces across the country, strengthen information and communication technology (ICT) skills among students and are helping to promote social and economic development in some of the most remote areas of the country.

At the centers, students, youth and members of the local community are trained in how to use computers and are given courses for basic digital literacy needed to access information online. The center is useful because it gives students the ability to do online research in order to widen their knowledge of various subjects taught in school. They have also been able to transfer the computer and internet knowledge they have gained back to their families and communities, allowing them to use e-commerce platforms to do business and thus expand their family incomes.

Internet Advantages

While global connectivity is rapidly expanding and empowering billions of individuals around the world, ITU data shows that more than half of the global population remain cut off from the vast resources available on the internet. Access to information and communication technologies can help facilitate the United Nations’ Sustainable Development Goals (SDGs), especially in rural areas. Access to the internet allows citizens to access basic services such as education and health care and is helping to lift people out of poverty through e-commerce and job growth. Nowhere else is this more pertinent than in rural and remote areas. In 2016, Thailand had more than 29 million internet users or 42.7 percent of the total population, which puts the country in the 24th place in the worldwide ranking of internet users.

Thai People Map and Analytics Platform

In 2018, the Office of National Economic and Social Development Board (NESSB), the National Electronics and Computer Technology Centre (NECTEC), the National Science and Technology Development Agency (NSTDA) and the Ministry of Science and Technologies joined up to help alleviate poverty in Thailand. The NECTEC center developed the Thai People Map and Analytics Platform (TPMAP) to pinpoint the problems people are facing in Thailand in different areas. Policymakers can use TPMAP to decide on which poverty programmes are suitable for each poverty-stricken area specifically. The data system TPMAP collects can help improve the quality of people’s life by increasing income, boosting employment opportunities and reducing living costs.

Suttipong Thajchayapong, a senior researcher at NECTEC, said that to understand poverty in Thailand, the three questions of who are the poor, what are their basic needs and how can their poverty be alleviated need to be answered. TPMAP can precisely answer these questions by integrating data from different government agencies. It can also compare individual indicators year to year to see if poverty is reducing. TPMAP uses five poverty benchmarks to determine levels of poverty. These benchmarks include education, healthcare, income, living standards and access to public services. The total number of people surveyed this year was 36,647,817 people and out of this number, 1,032,987 were targeted as poor people, according to TPMAP.

Establishing internet connections as well as various platforms such as TMPAP are examples of how technology is reducing poverty in Thailand. If Thailand continues to implement programs utilizing technology, people living in poverty will have more access to basic services. The country has implemented multiple programs that have addressed the issue of reducing poverty in Thailand. Utilizing technology is crucial for helping people living in poverty to access basic services.

– Casey Geier
Photo: Flickr

Tech Industry in Cameroon

As Africa experiences the highest rate of growth of digital consumerism in the world, Cameroon finds itself at the forefront of the continent’s technological boom.

This rise of the tech industry in Cameroon is quickly changing the landscape of the country, and the investment opportunities these companies are bringing in, as well as the digital products they produce, could prove key to building Cameroon’s economy and improving the lives of its impoverished citizens.

Rise of Startups

Despite the steady improvement of living conditions in Cameroon, many citizens still struggle to survive. As a result, numerous startups in the country have set out to use advancements in technology to work for people in need.

Noticing that the cost of smartphones is lowering every day while access to health care is still difficult and that the infant death rate remains high, tech startup GiftedMom created an app allowing pregnant women and new mothers to text health care professionals for help when they cannot afford to see a doctor in person.

Similarly, Agro-Hub set out to help farmers, who make up nearly 70 percent of Cameroon’s population, as they fight to keep their work profitable. The startup helps farmers adapt to market changes, sell their products and find a community among other farmers who may offer help.

As unemployment remains a constant issue, web platform Njorku helps people from Cameroon to find jobs by offering an easy-to-use interface for both people looking for work and recruiters trying to find well-suited candidates.

These startups, only a few among many, use technology to solve real-world issues with practical solutions. As they succeed, the users they target (impoverished peoples, mothers and infants, unemployed individuals) also succeed.

Through Education Comes Potential

Seeing the possibilities that can arise when people are educated and knowledgeable about technology, many tech industry professionals both within Cameroon and abroad have invested time and resources to prepare young people for participation in the industry.

In 2015, German software corporation SAP hosted Africa Code Week in 17 African countries, including Cameroon, with the goal of spreading digital literacy and preparing African youth to work and compete in an increasingly digital world.

The Genius Center in the Cameroon city of Douala teaches children coding, computer skills and the ability to think of digital solutions for real-world issues, preparing them not only for employment but also to use these skills to improve their communities.

While Africa’s fast-growing population raises alarms of poverty and unemployment, the rise in technology training provides hope for job openings increase and creation of well-educated workers who are capable of performing in these roles.

Looking Forward

As the tech industry in Cameroon continues to grow, significant changes are necessary for the growth to be sustainable. The country is still reeling from a three-month government-imposed internet shutdown in English-speaking regions that ended in early 2018, leaving tech professionals wary of the government as it announces plans to support the industry in the coming years.

Due to tech professionals’ suspicion of the government and Cameroonian business peoples’ hesitation to invest in this industry, many startups have sought investment from investors outside of the country.

For Cameroon to fully enjoy the benefits of this growing industry, domestic investors must understand and support the rapidly evolving direction in which the world market is trending.

While these changes are necessary for the benefits of the tech industry in Cameroon to be realized, the country has already made significant headway in establishing itself as a global competitor in the industry.

 – Rob Lee
Photo: Flickr