June 14, 2010Shawn Covell
Qualcomm and Grameen Foundation’s Long Collaboration Brings the Benefits of Wireless to Rural Indonesians
Over the last three years, Qualcomm Wireless Reach and Grameen Foundation have worked alongside Indonesian organizations to evaluate, test and build a Village Phone Microfranchising program. Combining the power of microfinance with the benefits of expanding access to wireless communications (mobile phones) has resulted in positive economic and social returns for entire communities. Village Phone helps Indonesians by extending affordable telecommunication access to people who cannot afford their own mobile device and by offering a profitable business opportunity where an entrepreneur purchases a kit that includes a mobile phone with a microfinance loan and then re-sells the “airtime minutes” to neighbors. The program provides a unique opportunity where communication services and applications are sold by the underprivileged, within poor communities. And from there, the mobile phone serves as a platform to provide additional applications and services to further increase the entrepreneur’s revenues and margins.
- The number of Village Phone Operators (VPOs) continues to grow – there are currently over 1,600
- More than 100,000 customers are served by the VPO network
- It is estimated that 47% of the entrepreneurs who continue to own and operate the business after 4 months are able to move above the poverty line ¹
- 91% of VPOs are women
- 100% of them are profitable
And our work is far from done. All of the partners continue to work together to expand this project and create new opportunities.
- Indonesian wireless operator, Bakrie Telecom, and device manufacturer, Huawei, recently joined local officials to celebrate project milestones and an additional donation of 500 phones.
- A local Indonesian social enterprise was incubated and now operates as the implementing partner for Village Phone in Indonesia. This social enterprise, called RUMA, helps poor micro-entrepreneurs become airtime resellers and is adding additional products and services that will further increase entrepreneur incomes and move RUMA toward financial sustainability.
- RUMA was also awarded the Harvard Social Enterprise “Pitch for Change” award and was the runner up for the Global Social Venture Competition award put on by the Haas School at UC Berkeley.
The long collaboration between Qualcomm, Grameen Foundation and the Bakrie Telecom teams is a shining example of how organizations can work together to create and implement innovative, scalable and sustainable solutions that meet the growing demand for affordable access to information and communications. Through a model that is market-oriented and builds on the strength of microfinance, we are very pleased to be a part of a project that shows just some of the ways that the application of wireless technology can lift people out of poverty. For more on this project and what Qualcomm is doing to enable entrepreneurs worldwide, go to www.qualcomm.com/wirelessreach.
¹ Baseline income is assessed using the poverty score determined by the Progress out of Poverty Index. This score is mapped to an approximate baseline income level. This estimated baseline income level is cross-referenced with actual transactional data for each entrepreneur to calculate the increase in income and therefore estimate movement above the $2.50/day World Bank’s definition of the poverty line.
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