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2	What is ICT for Development? In the “ICT4D” terminology, development usually refers to social and economic development in poor, predominantly rural areas of the developing world Information and Communication Technologies (ICTs) may be a way for rural people to access a variety of useful services, leading to local economic opportunity and community development
3	A Chain of Problems In Rural India Access to clean water – Industrial pollution, use of chemical fertilizers and over-exploitation for agriculture has made clean water hard to find Lack of education – Lack of qualified teachers and incongruence of curriculum with rural life lead many to abandon formal schooling Poor health conditions – Tainted water coupled with un-balanced diet lead to problems which are not reached by modern medical services Government inefficiency – Lack of access leads to corruption and inefficiency and make government interface with rural areas impotent Unsustainable use of natural resources – Use of dangerous pesticides and over-harvesting has depleted farmland and other natural resources Lack of economic opportunities – Increased competitiveness of farming, depletion of farmland and lack of rainfall lead many to seek alternatives Rural migration – Lack of livelihood leads many to seek work in cities, where they work for peanuts and live in squalid conditions
4	What do we have to offer? For many of these things, absolutely nothing (in some cases “we” caused these problems) But information is an important resource After basic necessities are met, can we use information technology to empower a rural village? Could this be a model for “leapfrogging” intermediate stages of development? Could this lead to more sustainable means of providing rural livelihoods? Some people think so.
5	Talk Outline Present the major application areas in ICT4D Explore recent policies governing rural financial services in India, highlighting the exploding activity in microfinance Present CAM, our vision of a lightweight, flexible information services architecture for rural India Discuss how CAM could help reduce current inefficiencies in microfinance Discuss some other public policy issues Concluding thoughts
6	Rural ICT Applications E-governance and E-services ICT training and general education Health informatics and education Business services Communications Financial services
7	E-governance and E-services Idea: Allow rural people to access government and commercial services through tele-centres or kiosks Save rural people time and effort in accessing important services
8	Case Study: Bhoomi Location: Karnataka, India Proponent: State of Karnataka Concept: State has computerized all land records, making them easier for farmers to access through public, manned pc kiosks Comments: Reduction in corruption, fraud and delays Big Win: Computerization made mandatory at district-level
9	ICT Training and Education Idea: Improve quality and reach of education using modern information technology Allow a wider segment of population access to education, particularly in places where teachers are scarce Improve the quality of education through communications and access to online resources Provide training in modern ICTs, increasing economic opportunities for rural people
10	Case Study: NIIT Location: Across India Proponent: NIIT Pvt. Ltd, New Delhi, India Concept: Leading ICT training provider in India. Operates in a franchisee model, proliferating deep into cities and towns
11	Health Informatics and Education Idea: Use information technology to collect accurate data about rural health and provide timely advice and intervention Improve rural health conditions through better hygiene, sanitation and health practices Save rural people time and money in accessing important medical services
12	Case Study: HIV Confidant Location: South Africa Proponent: Dimagi, Inc., Cambridge, MA Concept: Allow secure, confidential storage and distribution of HIV test results in rural areas using a handheld computer Comments: Allows anonymous health surveillance Secure, discreet result disclosure Individuals can choose to request additional counselling on their test results and condition
13	Business Services Provide local market rates, allowing rural people to get the best price for their produce Create new channels for introducing products to rural areas Disseminate best practices, improving agricultural performance
14	Case Study: ITC's e-choupal Location: Maharashtra, India Proponent: Indian Tobacco Company, Hyderabad, India Concept: ITC-supported kiosks allow farmers to access market prices, order supplies and learn best practices
15	Case Study: Knownet-Grin Location: Gujarat and Tamil Nadu Proponent: Sristi / IIM-Ahmedabad, Gujarat, India Concept: Create a multi-media information network supporting grassroots “innovators”
16	Communications Idea: Provide communications facilities in a variety of modes (phone, VoIP, chat, email, video, etc.) Comments: Has been the driving factor in several recent technology adoptions (STD, cable, mobile, cyber-cafe) Chat and email are increasingly popular among many classes in urban areas Network externalities?
17	Financial Service Delivery Idea: Support the operation of rural microfinance institutions, by providing MIS support and lowering the cost of cash handling Allow microfinance institutions to better manage their money through accurate data collection and timely reports Lower the cost of cash handling through automated, electronic transactions
18	Emerging Models for Microfinance Service Delivery in Rural India Tapan S. Parikh University of Washington December 2004
19	History of Microfinance Microfinance: provision of small-scale loans, savings and other financial services to the poor 1950s – 60s: Microfinance begins as highly subsidized rural credit programs in rural areas, part of larger development projects 1970s – 1980s: Spurred by the idea of solidarity group lending, and two notable success stories (Bangladesh and Bolivia), microfinance repayment performance improves globally 1990s – present: As estimates of global repayment rates hover around 95%, many microfinance institutions (MFIs) commercialize into for-profit companies or become “real” banks 2003: Microcredit Summit campaign reports microfinancial services reach 41 million poor people worldwide (> 9 million in India)
20	Solidarity Group Lending No traditional collateral, only “social collateral” Repayment enforced by mutual liability, or peer-pressure “If you don't pay back your loan, I can't get mine!” Many varieties and operational models
21	“Flavours” of Microfinance Grameen Model: Pioneered by Grameen Bank in Bangladesh in the late 1970s, now extends world-wide through grameen replicators. Village Banking: Developed by John Hatch in Latin America in the mid-80s, focus is on forming independent village banks. Self-Help Groups (SHGs): Savings-led approach pioneered by Myrada and PRADAN in India in the mid-80s. Similar to Village Banking, focus is on developing community-run Self-Help Groups. ASCAs, ROSCAs, small Credit Unions, etc.: Similar groups have been operating formally and informally around the world for hundreds of years. Individual Lending: Single client method (with or without collateral), suitable for larger loan amounts and more affluent clients. Currently in Eastern Europe and Latin America.
22	Traditional Model
23	Central Government Approach to Rural Financial Services in India (1969-1991) 1969 : 14 major private banks are nationalized 1977 : Central government institutes regulation requiring all banks wishing to open branches in “banked” locations, to open four other branches in “unbanked” locations 1969 – 1994: Number of bank branches in India grows from 7000 to 60,000 (2/3 in rural areas) 1977 – 1990: Economists give analytic proof that rural branch expansion program has a positive correlation with poverty alleviation... But surely at a HUGE cost (rural infrastructure, subsidies, bad loans, poorly developed financial instruments, corruption, inefficiency, etc.)
24	Microfinance in India (1980s - present) 1980s - 1992: Microfinance pursued largely by NGOs and social service organizations, based on “promoting” semi-indigenous SHG groups - early implementers of SHGs were MYRADA, Pradan, SEWA 1991: Foreign exchange crisis in India, extensive economic reforms 1992 - present: National Bank for Agriculture and Rural Development (NABARD), with support from RBI (Reserve Bank of India), commences SHG-Bank linkage program, where SHGs are directly linked to India's existing extensive rural bank network 2002 – present: A number of NGOs themselves become commercial Micro-Finance Institutions (MFIs). 2001 – present: Large private sector banks (most notably ICICI) entering the fray, financing both MFIs and SHGs directly. Several international banks and social venture funds are also interested.
25	Outline Discuss emerging trends in micro-finance Commercialization Competition Discuss existing gaps and inefficiencies Present technical approaches towards improving efficiency Present our work - a secure, lightweight information architecture for remote service delivery
26	Self-Help Groups (SHGs) Semi-autonomous rotating savings groups Formed, trained and initially managed by some promoting agency (usually NGO) Members save fixed amount at regular meetings Capital lent to other members for some purpose
27	SHG-Bank Linkage Model
28	SHG Promoters Govt (state, district, etc.) 52% (AP) MFIs / NGOs 30% Banks (RRBs, cooperatives, private) 17% VVV (farmers clubs) 1% Individuals ? Federations ? Self-promoted ? Ideally SHGs will eventually become independent, but this is not always the case
29	Commercial MFI Model
30	Grameen Methodology Organized into 5-member groups, with 5-6 groups in each village centre In first loan cycle, 2-3 members receive loans, which is entire group's responsibility for repaying (or others don't get loans) Rigid operational guidelines and institutional structure (filters down from Grameen Bank) Clear distinction between institution and client Much quicker to form than SHGs (institution-driven) Less emphasis on savings, local independence
31	Race to 300 million: Berkeley, Got a graph?
32	Key Questions What are the major current gaps and inefficiencies in microfinance service provision? Who will leverage existing strengths to deliver cheaper, more accessible services? Both models currently growing exponentially Will commercial MFIs (and private banks) be able to develop inexpensive new service channels to cut out existing RRBs? RRB branch or agricultural co-op exists within 5km of almost 99% of people (different the rest of world) What will happen to the social agenda???
33	Gaps and Inefficiencies The Client Information Gap The Institutional Information Gap The Rural Money Gap
34	The Client Information Gap
35	The Institutional Information Gap
36	The Rural MONEY Gap
37	Traditional Cash Model
38	A More “Efficient” Model?
39	Closing the Loop: Smartcard / POS Device
40	Smartcard / POS Device Pilot-tested by ICICI bank in Karnataka, India Warana Sugar Co-op in Maharashtra, India HP Rural Transaction System in Uganda (under development) Various G2P, P2P and P2B efforts in Africa Main constraint has been cost of POS device and merchant acceptance Successful in closed-loop economies
41	Closing the Loop: Rural ATM
42	Rural ATM Current initiatives ICICI / IIT Madras in Tamil Nadu, India Prodem in Bolivia Widespread urban use in Africa Constraints Cost of ATM Machine Security / Identity verification Power / Connectivity Interface design for illiterate clients Policy issues
43	Our Work Mahakalasm MIS CAM SHG-Notebook SHG-Checkbook
44	Mahakalasm MIS Working on MIS with SHG Federation in Pulvoikarai, southern Tamil Nadu Specially designed ledgers for rural SHG members Web-based software for accounting and loan tracking Consistent colour-coding between ledgers and screens Based on earlier work designing computer user interfaces for semi-literate users How simple and intuitive can we make accounting?
45	CAM: the Camera as Interface CamForms are documents containing embedded data and processing instructions CamBrowser is a mobile phone application that can interpret these documents CamShell is the embedded scripting language that ties the two together
46	CAM: Rural Information Services the appropriate information medium for every context
47	Potential CAM Applications Micro-finance SHG-Notebook SHG-Checkbook Others E-voting Health information Communications Other Services
48	SHG-Notebook SHG-Notebook is an augmented notebook used to maintain SHG records Transcribed and uploaded to the server with the CamBrowser The group can request financial reports and account statements Service is provided through an on-line application service provider (ASP) via a Cam-Browser enabled kiosk, or by via a field officer who visits SHGs and collects data
49	SHG-Checkbook SHG-Checkbook is an electronic checkbook for SHGs SHGs can write checks to members, and use deposit slips to make payments CamBrowser allows real-time transaction processing and authorization Each check contains a digital security key ensuring it is used exactly once CAM-enabled ID cards for alternate security conditions
50	CAM Microfinance Architecture
51	Proposed CAM Benefits Secure, low-cost, mobile information architecture using mass-market hardware (mobile phones, pc's) General design allows leverage across diverse paper-based “applications” with same infrastructure - no special purpose software between server and form Paper, camera and audio-based interface proposed to be accessible and trust-worthy for rural users Bring the services to the people - Mobility allows service delivery where it is most convenient and affordable for end users
52	Partners Covenant Centre for Development: Madurai, India Mahakalasm SHG Federations: Madurai, India Community Enterprise Forum India (CEFI): New Delhi, India Medicinal Plant Portal (medplant.com): New Delhi, India ekgaon technologies: New Delhi, India
53	Current Status Functional prototype developed January 2005: Initial usability trials August 2005: Field implementation Also working on Other application concepts Extending the functionality of the architecture
54	Public Policy Issues in ICT4D Local-language computing Open source Tele-centre / kiosk model Network infrastructure
55	Local-language Computing What is the role of government in supporting local-language computing? Standards Technology Content
56	Standards Indian language character encodings are still somewhat of a mess 18 official languages, and thousands of sub-languages and dialects Character encodings set by central government, which has historically had the only Unicode representation Leads to fragmentation between character encodings, font encodings, etc. Lack of standardization in input methods also
57	Standards: CDAC, Pune Set encoding standards for Indic-language software, and sold software for indic-language computing Conflict between public and commercial interests Resulted in a state monopoly which developed bad software Has seen the error of its ways, and is now publishing its research, encodings, and open-sourcing some of its software
58	Technology: TDIL and NCST Technology Development for Indian Languages (TDIL): Indian government funds machine translation, text to speech, OCR, and other research through a network of research centres and universities National Centre for Software Technology (NCST) First fully functional renderer for Indic languages (Indix) Worked with Microsoft on rendering and fonts XP first MS version with Indic support (9 languages, + 2 more with SP2)
59	Content and Applications Besides the kinds of government services we have already discussed, there has not been as much work at a national level in providing local-language content and applications State-level and district-level provision of content varies greatly – lots of good examples, and lots of inactivity also
60	Open Source Open source has become a political issue in India IndLinux: A loose federation of state-level localization teams that have succeeded in producing indic-language versions of most of Gnome and KDE Indic-computing: An open resource site for issues related to indic processing, rendering, standardization and indic-computing in general Simputer: Simple Multi-lingual People’s comPUTER - an experiment in open source hardware
61	Tele-centre / Kiosk model Create PC-based rural info-centres or kiosks, which act as a provider of various basic information services Internet browsing, chatting, printing, scanning, training, and other more specialized services Notable implementers: Drishtee Akshaya, Kerala MSSRF, Tamil Nadu
62	Information Kiosk in Every Village? In July 2004 M.S. Swaminathan Research Foundation and One World South Asia launched an ambitious national alliance to extend the reach of ICTs to all 600,000 villages in India by 2007 Does it make sense to invest so much in a country's IT infrastructure without a sound application base and economic justification? Is the PC the right mode of delivery? Some estimate that the cost of an info-centre exceeds a village's gross yearly output
63	Network infrastructure Various options in providing rural connectivity WiLL CDMA vs. GSM 802.11 vs. 802.16 This is as much a political / economic decision as it is a technical one How will each country decide to wire itself?
64	Problems Revisited Access to clean water Lack of education Poor health conditions Government inefficiency Unsustainable use of natural resources Lack of economic opportunities Rural migration
65	ICT4D: Hope, Hype or Hip? ICT4D is here to stay Developing country governments have a right to be optimistic and ambitious Technology companies have a vested interest in making it happen However, serious questions remain and must be addressed
66	Questions Top-down vs. Bottom-up To be successful in its stated goals, ICT4D has to be driven by demand from potential users Which applications will rural people be able to access? Which applications will they find germane to their lives? Which applications will contribute to development, and which will merely be “consumed”?
67	More Questions What is the rural condition? What do people want? What do people need? How are rural areas changing? What is improving? What is not? What will be the future? Does the modern world have something to help rural people?
68	Our “Motivating” Ideas Communication is a two-way street - Communities are built upon underlying networks of person-to-person communication and interaction. Ownership is important - Communities stand to benefit from information services in a proportion roughly equal to the proportion they "own" the services they are using. Applications are even more important - Accessible, useful content and applications are the most important component in empowering people with information.
69	Case Study: Drishtee Location: Several states in India Proponent: Drishtee.com pvt. ltd., New Delhi, India Concept: Drishtee partners with local governments to develop web-based service portals. Access is provided through internet kiosks, owned and operated in a franchisee model, where Drishtee provides hardware, software and services. Comments: Allows franchisees to share in economic benefits Close coordination with local governments
70	Case Study: Schoolnet Africa Location: across Africa Proponent: Independent NGO network Concept: “support national schoolnets to enhance learning and teaching through the use of ICTs” Comments: Improve cross-cultural learning through communications in the classroom Provide access to novel learning tools and technologies
71	Case Study: Aravind Eye Hospital Location: Madurai, Tamil Nadu, India Proponent: Aravind Eye Hospital, Madurai, India Concept: Already famous for providing low-cost eye operations, Aravind is now using digital images and video to remotely diagnose rural patients Comments: More cost-effective than conducting costly and time-consuming “eye camps” Saves valuable doctor time Save healthy patients an unnecessary trip
72	Case Study: SKS Location: Andhra Pradesh Proponent: SKS Microfinance, Hyderabad, India Concept: Used PDAs and smartcards to keep microfinance records in rural areas Comments: Noted improvements in accuracy and efficiency of data collection Time savings was not found to be worth the financial investment
73	Case Study: Rural ATM Location: Tamil Nadu, India Proponent: ICICI Bank and IIT-Madras, Chennai, India Concept: Low-cost ATM machine for rural areas, huge cost savings ($700 vs $15,000)