SDG 1: No Poverty

Why it matters

SDG 1 focuses on eradicating poverty, providing equal access to economic resources and building the resilience of the poor. While global extreme poverty stood at 8.2% in 2019, a decline from 15.7% in 2010, the rate of decline has slowed and is projected to grow for the first time in two decades as a result of the Covid-19 pandemic.

The industry contribution

Mobile technology contributes to SDG 1 by driving sustainable economic growth, helping households to lift themselves out of poverty and enabling humanitarian assistance. Mobile is used by around three-fifths of the world’s poorest 40% (equivalent to 1.9 billion people) [This calculation of mobile penetration takes into account the poorest 40% of the population in each country.], an increase of 200 million since 2015. As a general-purpose technology, mobile drives improvements in productivity and efficiency in other sectors and the wider economy. It enables both rural and non-rural firms – especially small and medium-sized enterprises (SMEs) – to reach more customers in non-local markets, which in turn allows them to expand and create new jobs for local communities.

Helping households lift themselves out of poverty

Target 1.1: By 2030, eradicate extreme poverty for all people everywhere, currently measured as people living on less than $1.90 a day.

Mobile money has helped reduce the financial exclusion gap in LMICs. There were more than 1 billion registered mobile money accounts by the end of 2019, representing an increase of 460 million since 2015. For individuals that would otherwise be excluded from financial services, mobile money allows them to better manage their cash flow, handle risk and build working capital. In Kenya, access to mobile money has lifted 2% of households (almost 200,000 households) out of poverty. In rural Uganda, evidence shows that mobile money can improve the welfare of rural households by smoothing consumption and curbing poverty.

Mobile money also increases the ability of households to save money and withstand unexpected life events that affect income or assets, such as job loss, health problems or environmental and economic shocks. In Burkina Faso, mobile money users were found to be three times more likely than non-users to save for unpredictable events and emergencies. In Tanzania, it was found that mobile money users could fully mitigate the negative effect of a rainfall shock on their consumption. The use of mobile more generally also aids poverty reduction. In Peru, mobile phone expansion reduced poverty incidence by 8 percentage points and decreased extreme poverty by 5.4 percentage points. In Nigeria, the rollout of mobile broadband networks in 2010–2016 increased labour force participation and reduced extreme poverty by 7 percentage points.

Case Study

Kenya: connecting households and businesses with informal workers

Context

According to the United Nations Development Programme, around 27% of Kenya’s total workforce is poor. Good work does not necessarily mean more work or higher pay, and positive feedback and a strong track record of work do not generally translate into borrowing power or the ability to start a formal business.

Solution

Founded in 2015, Lynk’s core offering is to connect informal workers to suitable jobs. Users submit their service request on the platform, which is then forwarded to available service providers via SMS. Interested service providers can bid for the job by replying to the job message. Once users select their preferred worker, the job is delivered on-site. Customers pay via mobile money or card and are prompted to provide a service rating.

Impact

As of January 2020, Lynk has transferred over $4.5 million to its registered workers, and over 45,000 jobs have been booked and completed through the platform, creating jobs for over 1,300 active registered users.

Source: GSMA Ecosystem Accelerator Innovation Fund Start-up Portfolio

Enabling humanitarian assistance

Target 1.5: By 2030, build the resilience of the poor and those in vulnerable situations and reduce their exposure and vulnerability to climate-related extreme events and other economic, social and environmental shocks and disasters.

Mobile networks are critical in supporting risk reduction and relief efforts during disasters and humanitarian crises. Partnerships between operators and humanitarian organisations can provide a channel for the delivery of humanitarian cash assistance via mobile money, supporting both resilience and response efforts. In addition to supporting emergency calls for help, mobile services can bolster emergency broadcast systems and provide location data for disaster relief coordination. Operators and humanitarian agencies also work together to enable early warning alerts to people living in areas that are at high risk for disasters. In 2019, Digicel Haiti partnered with Mercy Corps and Viamo to pilot CHANTER (Communities in Haiti Access New Technologies for Early Warning/Response). Over 11,700 unique users received access to information and advice, delivered via SMS and IVR, on best practices to improve their adaptability to climatic events such as droughts, hurricanes and floods to protect their lives and livelihoods. This project was supported by the GSMA Mobile for Humanitarian Innovation Fund. In March 2020, the same system was adapted to provide relevant information on COVID-19; 14,000 free calls were made within the first week of launch.

Case Study

Mozambique: responding to rapid-onset crises

Context

Mozambique has a history of humanitarian crises triggered by extreme climate conditions. An estimated 2.5 million people – almost 10% of the country’s population – are in need of life-saving and resilience-building assistance and two out of three people live in coastal areas vulnerable to rapid-onset disasters, such as cyclones, storms and flash floods. In spring 2019, two large tropical cyclones, Idai and Kenneth, struck southern Africa, making landfall in Mozambique. In the aftermath of both cyclones, close to an estimated 2.2 million people required assistance.

Solution

In the wake of Cyclone Idai, Vodacom Mozambique, the largest operator in the country, directed its response to Beira, the Mozambican port city hardest hit by the storm, both as an independent responder and in partnership with numerous humanitarian organisations and UN agencies to support affected communities.

The need for mobile connectivity to facilitate restoration of the area instigated Vodacom’s involvement in the recovery efforts. Mobile communication serves as the foundation of any emergency response, so the restoration of mobile connectivity was crucial for the community of Beira, as well as for those that needed connectivity to deliver critical services, such as commercial banks and medical services.

Impact

Beyond restoring connectivity to reconnect people and enable humanitarian responders to communicate with each other more easily and coordinate their efforts effectively, Vodacom’s actions supported those directly affected. Vodacom set up charging points that allowed people to charge their mobile phones to 30% for free and access vital services before giving up the space for others. It also provided free SIM cards to those who needed them. Further, every time a network tower was restored, all basic services (calls and SMS) were provided free of charge for seven days to allow Vodacom Mozambique subscribers living in the area to contact loved ones and access vital information. Basic/feature phone devices were cut to half the regular cost (less than $10) to help those who needed to access new handsets.

Source: Partnering during Crisis: The Shared Value of Partnerships between Mobile Network Operators and Humanitarian Organisation, GSMA, 2020

Maximising impact by 2030

Enablers that could help maximise the mobile industry’s impact on SDG 1 include the following: