As Afghanistan’s leading telecommunications provider, Roshan’s mobile phone service is transforming security, information sharing and entrepreneurship in the world’s second most corrupt country.
In June, Shainoor Khoja spoke to an audience at Mercy Corps about Roshan’s long-term investment in poverty alleviation through technology. Khoja described Roshan's operations across Afghanistan’s 34 provinces, places most companies usually don’t wish to work.
As former managing director of Roshan Community, Khoja established one of the first corporate social responsibility departments in Kabul, Afghanistan. In one of the toughest places in the world, Roshan shows how the private sector's engagement in their customer's communities can advance socio-economic growth in developing areas.
Her arguments brought life to a 2005 study published by telecom provider Vodafone, which found that "a 10 percentage point increase to a country's mobile phone penetration equates to a 0.6 percent increase in GDP.” Not bad for a cell phone.
When Roshan began operations in Afghanistan in 2003, there was little telecommunications infrastructure. Basic services, like landline phones, were prohibitively expensive. Making an international phone call literally required walking to another country. Roshan has now built a network that provides over six million Afghans with ways to communicate, and securely send and receive money.
Roshan looks for ways to create self-funding commercial services that provide stability, which in turn act as catalysts for jobs and growth in the area. It’s a perfect mission for Roshan, an entrepreneurial arm of the Aga Khan Development Network, a group of mission-driven organizations that work to improve the living conditions of vulnerable Africans and Asians.
“If you just provide stability and aid, you create a dependency,” said Khoja, describing a three-legged stool. “If you invest and create jobs, but you don’t have that stability, you’re not going to be successful in your economic development.” Roshan paves the way for other businesses to enter areas with fragile infrastructure by introducing and modeling best practices, and even turning down long-term exclusive contracts.
In Afghanistan, Roshan decided that one way to improve stability is through electronic money transfers.
“The typical Afghan bank looks like a [freight train] container with Wi-Fi and a lot of cash on the floor,” said Khoja. Roshan's mobile money component provides security and reliability—one of the most pressing concerns for families.
Having launched M-Paisa, Afghanistan’s first mobile money transfer service in 2008, Roshan lets people deposit and withdraw money, pay back a microfinance loan, pay bills, buy airtime and pay salaries. In a country of 45 million where there are only 17 commercial banks and 45 ATMs, Afghans need secure ways to access and deposit money. With text messages and numbered codes, Roshan allows money to be transferred securely. Khoja estimates that the system should reclaim up to $60 million a year that had been lost to corruption.
Roshan also engages unreachable communities in rural areas by lending shopkeepers money for branding, training and cabinetry so that they can set up their own shops and use Roshan's mobile services. “Their success became part of our success,” said Khoja.
Roshan wanted women to be an integral part of Afghanistan’s technological revolution, and it's working. Of the company's 1,200 employees, 20 percent are women. “We speak to the elders, explain what a second income could mean to the family and why it’s important for women to be engaged,” said Khoja. A recent study shows that 20 percent of women in Afghanistan own their own phone, exemplifying how Roshan’s penetration is challenging gender roles in the country.
Roshan also provides a service that gives farmers and agricultural traders daily, real-time market prices for a wide variety of goods by mobile phone. This information service, called Malomat, was launched by Roshan, Mercy Corps and USAID to help ensure that they are securing the highest value possible for their crops. Farmers and traders have two options: the user can either send an SMS and then receive information from Roshan with the pricing, or they can call the Malomat dedicated number and a guide will tell them the price of the commodity. Malomat is open to Roshan customers and non-customers alike.
Many of Roshan’s programs improve employees’ incomes and local businesses in the communities where they live while simultaneously promoting commerce for Afghanistan’s economy. In a country where communication was once difficult, the mobile phone is proving to be both an advisor and bank to millions.