Digital Transformation — Why learning from Africa

Recently I visited Nairobi, Kenya. And I got another glance on how the “digital revolution” is changing societies. Not only in Africa, but all over. I have been with Bitange Ndemo, former Permanent Secretary in the Ministry of Information and Communication. He is seen as an important enabler of the “digital transformation” in Kenya.

Wealth through the use of data

Data that is left in silos is wealth not exploited. Let’s create sharable open data,” writes Bitange Ndemo in his column at Kenya’sDaily Nation.

On the African continent the digital collection of data started only a few years ago with the massive roll-out of mobile phones. Then, mobile phones led the way to a specific African innovation, mobile money.

Mobile money …

Based on experiences with pre-paid phones and the possibility to transfer airtime, the first mobile bank M-Pesa was built in Kenya in 2007. Its idea has been as simple as genius: add a “wallet” to the phone number with the SIM-card as the platform. (Actually, find a practical introduction how mobile money works by Sam Floy, a young sympathetic traveller I met in Nairobi, here.)

Today, alone in Kenya more than 24 million people have an account with M-Pesa and half of the GDP’s money transactions are done through mobile money. Moreover, a recent study has clearly shown, that mobile money leads directly to accelerated economic activities and additional alleviation of poverty.

Mobile Money is possible because of the use of data from mobile phone providers. Through these data, M-Pesa is also able to provide small credits to its customers on massive scale. Therewith adding additional wealth to its customers.

… and other innovations

Of course, the digital transformation is not over yet. For example, by using the open interface of M-Pesa’s money services, M-Kopa, another Kenyan venture, has installed electricity in some 420.000 poor households with off-grid solar systems. In 2017 it should be over a million.

Mobisol, a German venture, follows suit and for now serves rural households in Tanzania and Rwanda.

M-Pesa’s open interface is also used by many, many other ventures in the financial services sector, in healthcare or in the training and education sector.

Digital transformation through open API

Digital transformation, through open APIs [Application Programming Interfaces], is making it possible to … begin building an API economy for inclusiveness. APIs are technologies that allow two or more software programs to communicate with each other,” writes Bitange Ndemo.

Why Kenya, why Africa? — Naturally, as always, because the right people created the right thing at the right time.

But, I think, there is another specific reason why things happen in an African country.

Learning from Africa

The African innovation culture has always been creative and good in doing. But lacked knowledge and technologies.

Globalization has changed that fundamentally. Today, the ubiquity of digital technologies and the access to knowledge provide the missing link.

Additionally, compared to Europe, much fewer vested interests and old technologies hamper innovation and entrepreneurship in African countries. More and more innovative applications emerge almost automatically.

That’s why we increasingly can learn from African countries how the digital transformation gets us from wealth not exploited (data in silos) to wealth created.

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