Mobile Phones Will Not Save the Poorest of the Poor

Entrepreneurs, businesses, NGOs, and governments exalt mobile technology as a game-changing tool to fight global poverty. But what if our eagerness to connect the world is inadvertently exacerbating the global economic divide?

In 2008, the New York Times reported that mobile phones may hold the key to ending global poverty altogether. The enthusiasm was—and is—understandable: From 2005 to 2010, cellphone use tripled in the developing world. According to the International Telecommunications Union, there are now almost 6 billion mobile-cellular subscriptions worldwide. Mobile penetration has reached 79 percent of the developing world. Multiple studies on information and communication technologies for development (ICT4D) have linked increased cellphone adoption with positive trends in economic and human development indicators, from gross domestic product to the Grameen Foundation’s Progress Out of Poverty Index.*

Despite the hype, a harsh new reality is unfolding. Take the case of the often glamorized M-PESA, Kenya’s popular mobile-phone-based payment and money transfer system...