Juvo’s rockstar moment is upon us

Now that I’m a one-day Mobile World Congress veteran, day two was an opportunity to continue to tell both Juvo’s story around vision as well as the technology that supports it.

“Will Sell Data for Cash”

This started with an amazing conversation around Mobile Network Operator’s desires to monetize their data. MNOs are sitting on a set of valuable data. The history on their prepaid customer base includes a host of microtransactions that can help companies like Juvo better understand one dimension about an individual: their ability to pay for a given product or service. Naturally, there are a number of transactions that this can help to enable, but getting the right data to the right people at the right time is easier said than done.

An industry expert walked me through the challenges that he sees in the market today. Most notably, making operator data available outside the four walls of the MNO. While MNOs should be protective of customer data both from a privacy and security perspective, many have trended in the direction of being overly cautious. There is however good news! Verizon is moving all of its key customer data and infrastructure to Amazon Web Services. This is a significant paradigm shift and hopefully a sign of more to come globally.

Effective data monetization can only happen with modern, sophisticated, and most importantly accessible data infrastructure.

Today in run-ins

Once again I was pleasantly surprised at the ability to randomly run into people. Speaking of Verizon, their former Chief Strategy Officer, and notably a Juvo Advisory Board Member, Roy Chestnutt. While waiting for a meeting, along came Roy down the hallway, which was a great chance to catch up.

“We’re Kind of a Big Deal”

Today was a big day for Juvo, with two Juvoians taking to the stage to spread the good word. First up was CEO Steven Polsky, who took part in a panel discussion around Digital Identity.

Steve did a great job in laying out what makes Juvo and our approach different to digital identity. While much of the conversation was around security and the risks that digital identities can help to mitigate, Steve decided to take a more positive approach:

“Many people talk about identity in the ways it can go wrong — at Juvo we use identity to help things go right”

Juvo is using data and the identities we create to unlock new possibilities for consumers, and thus the MNOs that serve them. When we’re successful in digital identity, we find ourselves in a position where we eliminate market inefficiencies around financial exclusion and everyone wins. Steve and his well-founded positivity won the day:

Lou Paskalis on Twitter

Don't think of Identity as a value-added adjunct to your business. If you resolve identity as part of your core business, open it up as a platform for your customers to engage with others on. Telco's who've done this are seeing 2x CLV" Steve Polsky, Founder & CEO, Juvo #MWC19

Immediately after Steve’s panel, was Meg Bear taking on the topic of gamification and the role it can play in mobile user experience. Gamification is a big part of what Juvo does for consumers and it helps our business partners better achieve their goals as well (ok, another win-win).

One thing that really resonated with me was a question she was asked about user research, and if Juvo conducts user research. Her response — “Although we do user research, it’s the data that tells us much more about the way that people interact with gamification and how it drives behavior.” User research is great and should always be a part of what we do, but we are fortunate to have a stream of tons of useful data, and a better understanding of how users behave and react to gamification in their mobile experience.

So, I guess we’re finishing where we started. Data is important. It can and should alter user experience to give consumers an experience that's tailored to them as a unique person. It will help consumers get access to new products in services in ways they haven’t before, in ways they couldn’t afford before. When Mobile Network Operators have a strategy for customer data that puts customers first, they will forge a better, longer, happier, and more profitable relationship for everyone involved.

Tomorrow is going to be another doozie — with many more interesting meetings to come. Sadly, our time in the spotlight has come to a close. But there are no small parts, just small actors.

We have reached maximum sensory overload

Today marked my first ever at Mobile World Congress and my expectations around both the scale and frenzy of the whole thing were exceeded. Walking the show floor is truly a sight to behold in the appreciation of the investment of time, effort, and money to have a booth here. Every direction you look, LED screens are in a constant state of animation, lights, sounds and endless amounts of people from every corner of the globe fill the walkways. The Fira de Barcelona is on the scale that can only be measured in football fields (or pitches, should you prefer).

Day one got off to a shaky start, with a transit strike and crazy traffic, but Meg Bear and I managed to arrive at our first meeting (10am) at 9:59am…phew. A great surprise awaited us when we grabbed a copy of Mobile World Daily (Since MWC is a temporary city of 100,000+ people, of course, it has its own daily newspaper) to find Juvo in the headlines with a great story which you can read in the link below:

MWC 19 Dailies - Juvo touts operator role for financial inclusion

Furious note-taking and water consumption

Once settled in, I spent the majority of our day in meetings, which was an amazing opportunity to share our vision and technology with a host of analysts and journalists from around the world. We answered a lot of questions and got to speak in detail about what we do, the value we provide and things we’re seeing in the market (hence the need for water). The amount of knowledge we shared was met if not exceeded by them (hence the note-taking). Learning more about the current state of affairs in Mobile Network Operators, forward-thinking Financial Institutions, and consumer trends around mobile and fintech will continue to help shape our thinking in San Francisco and around the world in 2019.

Most notable was the challenges that Mobile Network Operators are facing in their evolution to becoming financial services players in their own right. Whether they seek to create their own bank or find a local partner, the challenges are proving to be significant. Data can and should be a solution to this challenge, but can only be part of the equation. The intersection of two industries that are (rightfully) cautious and large in size requires partnerships with more nimble technology that can move the ball forward in a more rapid and ongoing basis. The consensus around both analysts and journalists was clear — the mobile industry needs Juvo.

The MWC #hypemachine in full effect

Folding phones, 5G, IoT, AI, #MWC19 is flooded with buzzwords and cool tech, but most of the hype and buzz surrounding the show is focused on the top end of the market in developed economies. While it’s great to see what’s next on the cutting edge at the top end, what’s far more interesting for me and Juvo is to see what mobile tech can do for everyone else. What was great about everyone we met with, was their understanding that the biggest opportunity in mobile both for the industry and consumers is to make the experience better and more impactful for the 78% of prepaid users around the world. Often forgotten by the industry hype machine — this is where mobility needs to be focused.

Networking, Networking, Networking

Scheduled meetings were a big part of today, but what surprised me more than anything was the ability to actually run into someone you know amongst the 100,000+ people at the show. I randomly ran into fellow Juvoians, friends, and former colleagues. Most notably, with my old pal, Scott Armanini of Samsung NEXT. I’ve gotten to work with Scott in the past and can’t wait to do so again at Juvo, especially with an awesome partner and investor like we have with NEXT.

We rushed back from the Fira to our first of two rooftop parties. It was a great chance to meet more people from the mobile fintech ecosystem and continue to have great conversations. It also helps to have some fresh air, a nice beverage, and Jamón Iberico. The energy, enthusiasm, and optimism in our corner of the mobile industry is truly awesome.

Tomorrow is going to be an awesome day, more meetings, more networking, and most exciting, Steven Polsky and Meg Bear will take the stage. Stay tuned for more from Barcelona!

The big themes I found this time around have to do with efficiency, customer satisfaction, and digitization. Onward:

1) Pricing strategies remain the primary avenue for “differentiation” with many Mobile Network Operators

The race to the bottom has largely shaped competition within the telco space over the past ten years. The commoditization of prepaid mobile service has forced telcos to constantly think about pricing in an effort to remain competitive.

The good news is that one of the latest trends in pricing is a win-win for both customers and telcos alike: the move away from airtime and into the direct purchase of bundles. Many years ago, when I was living in South Africa, I myself felt the pain of the top-up experience: getting a voucher, entering a 16-digit code into a USSD menu, and then spending more time navigating through other menus to purchase a bundle was the (inefficient) norm.

The ability to purchase bundles directly is a big win for convenience and simplicity. Consumers are responding. In almost every region, the move to bundles is rapidly accelerating. This is a win for telcos as well, as they benefit from more predictable revenues as well as greater levels of postpaid-like behaviors from their prepaid base.

2) “Free WhatsApp” is the white flag for voice and SMS revenues

I was walking down the street in South America when I saw poster ads for each of the three major telcos in the country. Each one of them had the exact same headline “WHATSAPP GRATIS” (Free WhatsApp). This made me want to laugh and cry at the same time.

What’s clear by all of the telcos offering Free WhatsApp in this market is that there’s no hope in regaining revenues from messaging and voice. Of course, overcoming the inertia that WhatsApp has behind it (55B WhatsApp messages are sent every day worldwide) was going to be impossible, if not close to it.

That being said, it would seem that free WhatsApp will only accelerate the move completely away from voice and SMS revenues: Juniper Research estimates that OTT voice and messaging services have resulted in $103B in lost revenues for telcos worldwide in 2018 alone.

3) Some MNOs are carving out their market niche in search of meaningful differentiation

I met with an MNO is Asia who seems to have a strong understanding of their place in the market and how they can build a moat around themselves. In their highly competitive market, this MNO came to the conclusion that they simply couldn’t keep up (nor did they want to) on the race to the bottom on price. As a result, they’ve changed their focus to medium-to-high value customers in their market. Their product will be priced at a premium, and therefore their rallying cry has become “awesome user experience”: any new project they take on must contribute to delivering an awesome user experience, and projects that contribute the most to that experience will be prioritized.

Will consumers pay a premium for an “awesome user experience?” Only time will tell. But in the face of the challenges that MNOs face in making prepaid work for them, I appreciate their bold approach.

4) The IT freeze is killing service innovation

So many MNOs I’ve met with feel completely helpless to get new projects through their IT organizations, and as a result have given up on many new and innovative projects that they wanted to undertake. One telco in particular told me that “the top way to get a new project prioritized in our org is if it can be done without IT involvement.” This telco was in the midst of a CRM and OSS/BSS (billing system) migration, so IT was justifiably strapped for resources. But this is no way for a company looking to be innovative to operate.

Different teams across the MNO are looking to innovate, and in many cases will need to work with partners to launch new projects. Without an IT infrastructure to get integrate partners with ease, this means the need for manual and IT-intensive projects. When IT teams are strapped for resources and have a docket full of highly important projects, this means innovation comes to a standstill.

We at Juvo have many thoughts on this, so stay tuned to this blog for more on how IT organizations can get the help they need, and think differently about resource allocation and supporting innovation.

5) Quad-Play consolidation is on the rise

This trend isn’t new, but it seems to be accelerating in many markets in which we are partnering with MNOs. Whether its TV & Internet Providers acquiring Mobile Network Operators, vice-versa, or building out a service offering portfolio, many telcos are focused on getting to quad-play offerings (TV, home internet, landline phone & mobile). AT&T notably paid $67 Billion to acquire DirecTV in 2015.

For customers, these are all services that are logical to purchase from a single provider. For the telcos themselves, being able to leverage functionality across screens and contexts make the value of all of their services greater. More importantly, they provide more opportunities for cross-selling and up-selling into new and different services.

The challenge that telcos have in this space is ensuring that they know what customers that can and should offer different services to. Developing a single view of a household and the services they have is difficult when prepaid mobile subscirbers may not be identifiable by name or address.

6) Distribution of digital goods through physical means is broken

One thing that I have heard consistently from telcos around the world is the challenge they face in paying significant portions of their revenue to sales agents.

Mobile network operators have done an incredible job in creating a vast distribution network for their services. This much is obvious when you’re in a predominantly prepaid mobile market, because you can top-up just about anywhere. This is to say that what’s in place is a system in which agents are selling physical goods (that require the customer to show up in person) in order to distribute a digital good.

It sounds inefficient because it is inefficient.

Everywhere we go, telcos are making efforts to move more transactions into digital channels, and away from “on the street” transactions — not only is it more convenient, but it eliminates the need for them to pay agent commissions. That said, there is a challenge: topping up in an app via credit card or electronic transfer is inaccessible to a large percentage of their customers.

Empowering subscribers to top-up digitally without a credit card or bank account would be a huge win for telcos, significantly increasing margins and convenience for consumers.

1. All mobile operators are facing the same challenge: commoditization

Over the past 13 years, mobile operator revenues have dropped a staggering 42%, and are projected to drop another 14% over the next four years. There are a number of external factors driving this drop in revenues, but the central challenge that mobile operators are facing is commoditization.

Once OTT services like WhatsApp, Viber, & Skype dramatically cut into revenues from voice and SMS, mobile operators were left with the majority of revenues coming from data. When the mobile operator becomes a provider of data for other OTT services, it becomes close to impossible to have any meaningful differentiation. That lack of service differentiation and the cost of switching being close to if not zero, mobile operators have been forced to compete on price. In some cases, we’ve seen instances where prepaid subscribers are encouraged to switch every month by poorly designed incentive structures in which they can save money by ditching a SIM card as soon as they run through new user promotions.

While some of these challenges are acute and specific to certain regions, the fight against commoditization is forcing mobile operators to rethink the way in which they attack the problem, but…

2. They think about the solutions differently

The fight against commoditization is typically being fought across two different fronts:

Optimizing pricing on core services
In most cases, mobile operators are looking at how they can modify pricing in a way that better incentivizes the right behaviors to prevent SIM swapping. This price warring further commoditizes prepaid service, and furthers churn.

(Worth noting: government enforced SIM registration is an external factor that makes swapping SIMs more of a pain, even though there is no monetary difference in cost. The overall market effect of that is TBD.)

Creating new revenue streams for their existing customer base
One outlet for mobile operators is the creation of new, non-telco specific revenues. These typically take the form of mobile financial services, identity services, and/or big data services. These initiatives are in many cases still at an early stage, and typically involve offering data to third parties to sell their own products and services.

However, there is a great opportunity that’s still primarily unexplored, and that lies in the customer data and touch points that global telcos have, but haven’t necessarily been architected to use beyond their core business models. The Mobile network operator’s greatest resource is the customers that they can reach in an instant — and the data generated through their transactions with those customers.

Think about it this way: in emerging markets, prepaid mobile services are some of the most common financial transactions any customer undertakes. What that means is that mobile network operators frequently have the opportunity and the access to create new business models by being able to reach their customers at their time of need. One example would be airtime lending before a customer churns out; another would be handset financing.

I fully expect that we will see operators’ thinking on this front to evolve as they see this opportunity to create their own products and services, which can create real and meaningful service and brand differentiation — along with a meaningful lift in customer loyalty, LTV, and ARPU.

3. “Fixed-pie” thinking is the greatest challenge to MNO innovation

Understandably, some mobile network operators seem to have lost their mojo. After so many years of declining revenues, a lot of people have come to believe that core business attrition is just the way things have to be. I refer to this as a “fixed-pie” mentality (read: the pie is always the same size), which leads to a misperception that partnerships are necessarily a threat to the business — one in which partners will take their existing revenue.

This viewpoint misses the understanding that partnerships can make the pie bigger, thereby giving everyone more pie (and who doesn’t like pie?). The MNOs that are seeing the most dramatic results are those who are innovating by choosing valuable partners to help grow the overall business, whether by reducing churn, creating incremental revenues, or both.

4. Driving smartphone adoption is a universally key initiative

Regardless of the methods, brining the smartphone experience to the masses is unquestionably a priority for mobile network operators. Smartphone adoption has a number of benefits: increased ARPU (roughly 30% increase, according to the GSMA), digital transformation (moving users into self-service apps can lower customer service costs), and moving users on to 4G devices (it’s typically more expensive to run legacy 2G and 3G networks).

Globally, smartphone adoption has hit the “affordability barrier” in which just about anyone who can afford a smartphone has one. The next frontier for driving smartphone adoption is finding ways to make smartphones affordable to those who have, to this point, butted up against that barrier.

The Mobile Operators I’ve met with are thinking about this in several different ways, from developing their own devices in partnership with low-cost manufacturers, to device subsidies, and creative device financing programs.

5. 2018 is the year of app consolidation

Throughout the decade, app stores and apps absolutely exploded. “The more apps the better” has seemed to be the mantra, and everyone — including mobile operators — joined the party. But it turns out we didn’t need one app to top-up, another to download content, and another to collect and redeem loyalty points.

Mobile Network Operators are now in the mode of consolidation, and are looking to build a single app that manages the entire set of interactions between them and their customers. Time and time again I’ve heard this — and not just at the country level, but also at the operator group level. While these apps may not see the light of day until 2019, you will soon see singular apps that are used across a number of countries and languages, all under the banner of a single mobile network operator.

So long as this is accomplished while keeping the size of the app within reason (per #4, inexpensive smartphones have limited storage), mobile operators have the opportunity to deliver real value to their customers, and — as a result — better engagement at a lower cost than before.

6. Bonus takeaway: do the little things to “upgrade” your travel experience

Juvo is a startup; we fly Economy class. You may not be flying 96,000 miles in two months, but a single flight of more than a few hours can be daunting without doing the little things to upgrade your travel experience.

What I learned is that while my ticket may say “Economy,” it’s worth it to do everything in my power to make it feel more like I’m on the other side of the curtain. Exit rows are always a nice perk, but once you’re in that seat there are a few items that will make your flight a lot more comfortable, for a fraction of the upgrade cost:

• QuietComfort 35 Wireless Smart Headphones | Bose
• Inflatable Travel HoodiePillow® | HoodiePillow® Brand Pillowcase and Hooded Travel Pillow
• The Companions
• adidas Deerupt Runner Shoes - Black | adidas US

I’ve found that with the right attitude, the right equipment, and occasionally a cocktail, you can make long flights in economy much more palatable.

Juvo began working with Cable & Wireless nearly two years ago, with the goal of driving even greater engagement with prepaid mobile customers with their FLOW brand, which is available in 14 countries in the Caribbean.

Cable & Wireless and Juvo partnered to build Flow Lend, an innovative service to deliver airtime credit extensions through a smartphone application. The application enables users to conveniently top-up at anytime, directly from their phone. Since most prepaid users top-up in retail locations using cash, topping up when they need to isn’t always convenient. Flow Lend enables them to top-up immediately and pay the next time they are around a retail location.

What makes Flow Lend a truly innovative service are the game mechanics and progressive levels of lending that enable users to continuously unlock greater value. Game mechanics within Flow Lend give the user total visibility into their lending and repayment behaviors as well as points and rewards for timely repayment and loyalty.

Even more, as users unlock rewards levels, they receive access to larger and larger loan amounts. These ensure that a user can take advantage of greater convenience and fewer trips to the store to top-up.

For many people in the Caribbean, this has proven to be a significant benefit. We met a Flow Lend user in Jamaica, Jackie, who has benefitted from the convenience as well as progressive lending levels from the service:

Jackie is able to top-up when traditional options are unaccessible or even unsafe in her instance. This means she can use her device the way she wants to, and as many Flow Lend users is now consuming more Flow services on a monthly basis.

Additionally, Jackie benefits from progressive lending that has enabled her to unlock higher loan values. For her, this means she can get easily top-up with airtime for herself as well as her children.

Convenience → Engagement → Key Operator Metrics

The newly found convenience that Flow Lend has brought to Cable & Wireless’ prepaid mobile subscribers has led to greater engagement amongst the userbase. Instead of running out of credit, users top up immediately and continue to use the network as they desire. For Cable & Wireless, this means that users consume more mobile services than they would otherwise, resulting in a 10% increase in average revenue per user (ARPU).

Moreover, Flow Lend has proven to be a significant differentiator for Cable & Wireless in relation to their competition. In markets where users have a choice of multiple mobile networks and switching is as simple as popping in a SIM card, service differentiation is vital. Prepaid mobile user churn is a problem for just about every mobile network operator, and reducing churn is almost always a key outcome. The impact of Flow Lend on churn was both rapid (within three months) and pronounced (a 50% reduction).

Through providing a new and highly valuable service to their customers, Cable & Wireless is seeing a significant boost to user experience as well as their bottom line.

But that’s not the entire journey…

This is just a small sample of the transformation that Juvo and Cable & Wireless have created through Flow Lend. To learn more about the Flow Lend story, follow the link below to download the Cable & Wireless Case Study:

Juvo Journey - Flow Lend

A simple financial service that mobile network operators (MNOs) offer today is emergency lending. The concept is very simple — giving prepaid subscribers small loans when they run out of airtime credit so that they can continue to use their device.

For MNOs, this enables them to reduce zero balance days (where someone has no credit and therefore are unable to use their device) which can boost the ARPU for prepaid subscribers. Simultaneously, emergency lending would reduce churn amongst prepaid subscribers as users become less vulnerable to the latest offers from competitors if they maintain useable airtime balance.

Increasing ARPU while decreasing churn is music to the ears of MNOs, and with good reason. These two metrics drive subscriber lifetime value. Unfortunately, emergency lending solutions have failed to deliver these outcomes, and theres a few reasons why. Let’s explore:

Availability

In developing economies, prepaid mobile subscribers can make up as much as 90% or more of the overall population. This means that there is and will always be significant disparity of incomes across the prepaid user base. This presents a challenge for MNOs as the ability to repay airtime loans will greatly differ across the entire population.

Unfortunately, the solution for emergency lending providers has been to significantly reduce the number of users who are eligible for airtime lending. In most instances, roughly 10% of the population will qualify for an initial airtime loan. To make matters worse, the 10% that often receive loans are users who have the longest tenure on the MNO’s network and have relatively high monthly spend — which is highly correlated with income.

What this means is that the people who are being offered airtime loans are typically the least likely to require them or benefit from their convenience. Meanwhile the other 90% of the prepaid user population, who are much more likely to benefit from the service, are completely shut out.

Small and Fixed Loan Amounts

Airtime lending is meant to provide a bridge from when the user runs out of balance until the next time they are able to conveniently top-up. With emergency airtime lending, that bridge simply isn’t long enough to cross the chasm.

Users are typically able to get less than a single day’s worth of airtime. For people with busy work schedules or those in rural areas, there may not be an opportunity to find a top-up location on a daily basis. For many, this means going back into a zero-balance state even after taking an emergency loan.

If the MNO’s goal is to reduce prepaid churn, emergency lending is unlikely to stop a user from switching SIM cards. Emergency lending simply delays the zero-balance event instead of preventing it from happening altogether.

Interest and Fees over Strategic Outcomes

Emergency lending provides a convenience for prepaid customers of MNOs, and is easily labeled as a value added service (VAS). MNOs have been programmed to associate VAS with incremental services revenues. Moreover, with any financial product, 100% repayment is simply not possible. As a result, MNOs and emergency lending providers have made the decision to charge interest and/or lending fees to use their services.

At Juvo, we’ve seen emergency lending fees range from around 10–40% of the value of the loan itself. As a result, users who qualify may simply decide not to take the loan due to the increased cost of the service.

Some MNOs have made the choice to view emergency lending as a VAS, and as a result have sacrificed potentially far greater strategic and profitable outcomes.

MNOs are potentially forfeiting revenues by prioritizing VAS revenues over the likely greater revenues that can be realized through significantly increasing prepaid user lifetime value. The uplift in revenues that are associated with interest and/or fees can easily be dwarfed by that of increased ARPU that comes from airtime consumption.

In the example below, we see that a 20% decrease in uptake due to the presence of fees results in less revenue overall for the MNO.

Reactive — Pull vs. Push

Emergency lending is offered to eligible users when they reach a zero balance, and typically requires that a user finds the service themselves. The creates an awareness gap and in many instances emergency lending may already be too late. In competitive prepaid markets, consumers are inundated with highly attractive promotions, especially as new users to a network. Every time a user hits a low or a zero balance on their device, those offers become more attractive and top-of-mind.

In the case of emergency lending, the goal of reducing user churn is greatly diminished by the fact that by the time a user may receive an offer for a loan, they can easily have already churned to another network.

Conclusions

Any one of these flaws would greatly decrease the efficacy of emergency lending, but the combination of them ensure that these programs deliver little if any benefit to the MNO.

Simply put, for a prepaid subscriber to benefit from airtime lending they have to be:

• Wealthy enough to be in the top 10% of users on the network
• Require a very small amount of airtime before they can top-up next (typically less than a day’s worth)
• Willing to pay a 10–40% premium for the convenience

Emergency lending simply doesn’t provide enough value to users to justify the pricing premium it demands.

Ironically, the push to make emergency lending a “value added service”, has ensured that it doesn’t deliver enough value to consumers or the MNO. Instead of monetizing the service itself, MNOs should focus on the opportunity to unlock greater and longer-term value.

Juvo isn’t emergency lending

This isn’t an easy challenge for MNOs to fix. Offering loans to customers you know very little about is incredibly daunting. But what if you could know more about them?

• Could you reduce the risk associated with lending?
• Could you provide more users with loans?
• Could you offer prepaid subscribers with meaningful loan amounts?

At Juvo the answer is simple. We use identity scoring to understand prepaid subscribers, which gives us the opportunity to say yes to more people.

Identity scoring, our proprietary data science algorithms, use a wealth of existing data sources to create a profile of a user. We get to know people better so that the first time they need a loan, we know who they are and can give them what they need.

As a result, Juvo gives initial credit extensions to over 95% of the population.

We partner with MNOs to create services that benefit consumers and delivers upon strategic objectives, like churn reduction and ARPU lift, instead of VAS fees. Juvo provides consumers with higher loan amounts that enable users to maintain a useful airtime balance. Loan amounts increase as users pay back on time, all without any interest or fees.

Unlike emergency lending, Juvo and our operator partners’ solutions are proactive: we meet the subscriber where they are at the time of need. Users receive automated notifications on their mobile device when they reach a low balance (typically a day’s worth of airtime). This ensures that prepaid users can top-up before they run out of airtime, not after they already have.

To learn more, visit juvo.com or send us a note at info@juvo.com

In September, the island nations of the Caribbean were hit with two category five hurricanes in the span of just a week. Hurricane Irma moved through the Caribbean with near-record, sustained 185mph winds, causing significant damage impacting an estimated 1.2 million people. Just as the people of the Caribbean had started the recovery efforts, Hurricane Maria came through the Caribbean, following a very similar path to Irma.

James McElvanna, VP of Products at Cable & Wireless shared his experiences with us as someone who has been through a number of storms in the Caribbean:

Every time a hurricane approaches the islands of the Caribbean, a string of events will precede it as people prepare for the worst. First, people begin to collect cash to ensure they can purchase basic necessities once the storm has passed. As a result, ATMs around the islands can run out of cash and are subsequently closed. Second, shops shut down one by one as they board up windows and further reinforce for their protection. Physical retail eventually shuts down completely with each shop closing one by one. So even if local residents are able to obtain cash, stores are likely to be closed or in short supply.

These conditions present a specific challenge as it relates to something as basic as mobile airtime. The impact of ATMs and stores shutting down is particularly felt in the Caribbean, as many countries there are largely cash-based. Adding airtime through credit card or electronic transfer is simply not possible for many residents.

While of course the destruction is rightfully top of mind for everyone, the disruption to daily life and access to basic services are also a significant challenge. Once the storm passes, being able to remain connected is incredibly important. Whether its to gather information, contact authorities, or even speak to loved ones to ensure that every one is OK.

Since 2016, through our partnership with Cable & Wireless, interest and fee-free airtime credit extensions are offer to prepaid mobile users through the FlowLend service. FlowLend is available across most of the affected islands in the Caribbean. As the storm approached, the impact that airtime credit extension was very apparent. When looking specifically at the countries that were most impacted by Irma and Maria, we saw a clear influx in airtime credit extensions in the build-up to the storms reaching the islands:

Airtime Credit Extension Volume by Day

As both of the storms approached, residents began to stock up on airtime just as they would any other necessity. The spike in the quantity of airtime credit extensions mirrored the spike in cash-based top-ups that took place through traditional retail outlets. In Antigua, Dominica and Saint Kitts & Nevis, airtime credit extension volume nearly doubled. On September 19th, as Maria was approaching, airtime credit extensions in Dominica increased by 258%.

Even more striking is what takes place when the eye of the storm actually reach landfall. The following shows the ratio of airtime credit extensions to cash top-ups as the eye of Hurricane Irma hit the Leeward Islands as well as Turks & Caicos approximately two days to the northwest:

Credit-to-Cash Ratio during Hurricane Irma’s Landfall

As Irma made landfall, purchasing airtime from shops would naturally become extremely difficult if not impossible. What we see above is what happens when cash based-top ups fall to zero. When traditional outlets were no longer available, FlowLEND enabled the people of the Carribean to top-up and remain connected through and after Hurricane Irma & Maria.

Borrowing enough to weather the storm(s)

While the impact was clear in terms of the quantity in which airtime credit extensions were being utilized both in preparation for and during Hurricanes Irma and Maria, by looking further into the data, the true impact on individuals becomes much more apparent.

Juvo provides progressive levels of credit based upon user behavior as well as lending & repayment history amongst a number of other factors. Initial airtime credit extensions typically give users 2–5 days of airtime balance, depending on usage. With repeat usage and reliable repayment, users can quickly move up to higher levels of credit that enable significantly more days worth of airtime.

We looked at more detailed data across the five Leeward Island countries previously mentioned to see what levels of airtime credit extensions were being utilized in preparation for Hurricane Irma. We then assessed how many days of usage these credit extensions would enable assuming average usage. Over the three days leading up to the storm, credit extensions enabled users in Turks & Caicos to obtain balance for the following amounts:

In circumstances when it was unclear when the islands’ cash and retail infrastructure would be restored, airtime credit extensions enabled:

• 56% of users to obtain at least a week’s worth of normal usage
• 37% of users to obtain at least two week’s worth of normal usage
• 23% of users to obtain at least three week’s worth of normal usage
• 14% of users to obtain a whole month’s worth of usage

In Turks & Caicos, we saw the greatest percentage of users at the lowest level of credit within our algorithm (a greater indication of their nacency within FlowLend then it is creditworthiness) amongst the Leeward Island countries. In many cases this was likely a user’s very first time utilizing FlowLend. Despite this, users were still able to obtain 3–4 days of normal usage, maintaining connectivity in the aftermath of the storm.

In the instance of St. Kitts & Nevis, the distribution of airtime credit extensions by amount was weighted much more evenly, with the plurality of users being able to and taking airtime credit extensions at the greatest length offered at the time of the storms:

While the highest level of airtime credit extensions available were shorter in length than in Turks & Caicos, airtime credit extensions enabled 71% of users to obtain at least a week’s worth of normal usage and 32% of users to obtain at least two week’s worth of normal usage.

Cash-based economies are particularly vulnerable to natural disaster as cash and brick-and-mortar retail become unavailable. FlowLEND has provided the Carribean with an additional conduit for obtaining airtime balance when traditional methods are down. Moreover, due to the levels of progressive credit in FlowLEND, users have been able to obtain enough credit to remain connected within the aftermath of Hurricane Irma, but well into the recovery efforts from Maria, which struck just days later.

Rebuilding the Caribbean

“At Cable and Wireless, our mission statement is ‘Connecting communities and transforming lives’, which really comes to light after Hurricanes.”

- James McElvanna — VP Products at Cable & Wireless (February 2017)

Cable & Wireless has created the Cable & Wireless Charitable Foundation and is doing great work to get basic necessities to the people of the Caribbean in the short term and to rebuild in the long term. You can learn more about their efforts here:

Cable & Wireless Communications | Cable & Wireless Charitable Foundation

And you can contribute to the cause here:

Cable & Wireless Charitable Foundation