Innovation · Livelihoods · Microfranchise · Technology

Increasing BOP income through mobile phones

Great article in Jakarta Globe on how a new mobile startup Ruma is helping to increase income for thousands of poor women in Indonesia through business transactions they are performing on their mobile (cell) phones.

Ruma is creating a supplemental income opportunity for agents in rural districts of Indonesia using the mobile phone that they already own. The first product Ruma agents offer is a convenient and price competitive mobile phone pre-paid “top up” (credit) service. Since it typically costs about $0.20 in travel costs (plus time) to visit the nearest town to purchase an additional typical $0.50 of top-up credit, this service is very popular with rural customers. Ruma buys the mobile credits in bulk from all of the major mobile operators, so their agents can provide top-ups for any mobile service and they share the profit margin with the agent. This is truly a win-win.

In addition to providing mobile top-up services, Ruma is reportedly testing some additional services such as a job posting/matching service which can also be distributed by their micro-franchise agents generating more supplemental income.

Ruma’s focus on providing an opportunity for supplemental income vs. primary income is smart. This makes it easier for them to find agents who can try out their system with less risk. As Ruma expands the income generating opportunities they provide to their agents, the agents can self-select whether they want to grow this livelihood opportunity as part of their income mix or keep it as a smaller, supplemental source. As the story of the shop owner demonstrates, having a high-interest service like this can also grow their footfall (foot traffic) and revenue (turnover) for their main livelihood.

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