Remote areas reap benefit of link to telcos’ network

In the past, to stock her shop in Turkana County’s Nakoret area, Regina Ekiru had to take a Toyota Probox to Lodwar town, pay Sh700 two-way, withdraw money from an ATM and return home to buy goods for her shop.

Today, the Communications Authority of Kenya (CA) has contracted Safaricom to set up a base transceiver station in the area, which enables business people like Ms Ekiru to withdraw money directly from their banks into M-Pesa accounts and shop for goods.

The setting up of a network in Nakoret is part of a Sh1.2 billion deal in which CA has partnered with telecommunication firms Safaricom and Telkom to boost network connectivity in 78 remote sub-locations across the country.

The programme is funded through the Universal Service Fund (USF) where CA takes 0.5 percent of revenues from telcos, broadcasters and couriers and uses it to fund projects which stakeholders may not have financial incentive to pursue.

The project is set to benefit residents of Turkana, Wajir, Garissa, Kwale, Kilifi, West Pokot, and Kajiado. Other areas which will benefit include Narok, Bungoma, Baringo, Isiolo, Kitui, Mandera, Marsabit and Samburu.

In Nakoret, the project has made it possible for Ms Ekiru to withdraw money every Thursday, market day, when an M-Pesa agent comes into Nakoret from neighbouring Kerio. She then shops for goods which local people can buy from her in the time between market days. According to research published in Science magazine, access to M-Pesa enabled about 186,000 families, or as many as two per cent of Kenyan households, to move out of poverty.

The impact on female-headed households was more than twice the average measured.

The reduction in poverty was due to the ease of transmitting remittances and increased savings. Further more women, especially, moved out of subsistence farming into business. However, Ms Ekiru explains that M-Pesa — whose network only became available in June last year — is still very much the new kid on the block. Bright yellow sachets of Ketepa tea and Knorr cooking spice line the walls of her dark manyatta shop as Ms Ekiru brings out an Equity agent machine and explains that most people go to her shop to withdraw money from their Equity bank accounts.

Through a partnership with the UK Department for International Development which began in 2013, Equity has been providing families up to Sh5,400 every two months in an effort to combat hunger in the region. According to the Kenya National Bureau of Statistics, people in rural areas who spend less than Sh1,954 per month on food live in food poverty. In fact, next door to Ms Ekiru’s shop is Nakoret Primary School which serves children lunch. Its dilapidated walls expose an empty Standard 1 classroom.

New students have not reported to school because of the discontinuation of the lunch programme.

Ms Ekiru’s Equity machine employs biometric recognition, meaning that residents need only provide their ATM card and then use their fingerprints to withdraw cash or check their account balance.

What is evident is that to promote financial inclusion and business in Nakoret and other remote areas, a multi-faceted approach will be required. According to residents, the Safaricom network has been instrumental in boosting business by improving security in the area. In the past, residents had to brave thorns and the scorching sun for three to four days to Murispo Hills to access a mobile network to report attacks by castle rustlers.

Telkom has observed the improved security in areas where it has set up its network under the programme.

“Telkom is pleased to note that the installation of two of the sites; one in Chepyuk and the other in Korn’gotuny, both in Bungoma County, has been of great help towards improving security in the area,” said Telkom in a statement to the Business Daily last week.

Under the programme, Safaricom and Telkom have expanded coverage for 238,082 people to their mobile networks, with the CA aiming to add 319,298 Kenyans when the project is complete. CA established the USF in 2009.

Today, 164 sub-locations still have zero network coverage, meaning CA and other stakeholders still have some ground to cover to bring all Kenyans onto the communication grid.