The poverty cycle is harsh. Among factors such as the scarcity of capital and skills, a lack of information further helps entrench poverty and makes the cycle unbreakable.

An initiative by Google and the Grameen Foundation, named AppLab (Application Laboratory), is an innovative solution to the problem of information asymmetry, which is particularly severe in rural areas all over the developing world. Essentially, the venture aims to offer a modified version of Google’s search engine technology through mobile phones. Various services, coupled with some good marketing techniques,  AppLab will deliver much needed information to the masses so they can improve their lives. AppLab comes in as the platform that is used to ‘build, test and scale’ various applications/services that will be used to deliver information to low-income group end-users, most of which have mobile phones thanks to the mobile banking revolution in East Africa and other parts of the world.

What Kind Of Information Do The Poor Need?

Although the informational needs of each community and country differ according to their social, environmental and economic climate, here are a few examples of mobile phone services introduced in Uganda (through MTN), where relevant and instantaneous information can lead to measurable gains:

• Marketplace prices (Service A): if poor farmers know trending prices for various crops and raw materials in the nearby market, which may happen to be a good 4km or 5km away, they can easily plan their visits to avail any favourable rises and falls in prices. Moreover, they can enjoy greater margins and bargains by exchanging an intermediary (a dealer in crops) for their mobile phones
• Health updates (Service B): low-income groups patients living in far off villages can be reminded about their medicine schedules, or the appropriate medication and dosages to be taken to treat various medical conditions, and even the location of the nearest health clinic, all through their mobile phones
• Tips on farming (Service C): farmers can get tips on making fertilizer or pesticides from easily available items to ensure their crops are healthy

The opportunities are endless.

Mechanics of AppLab Services

Since it has been established that technology can further the mission of microfinance, this partnership was only a matter of time. The technical elements of this venture are simple.

Firstly, a treasure trove of information, which is specific to the needs to end-users, is compiled into an SMS database by Google, which can be accessed by people in villages and small towns through their mobile phones’ SMS facility.

Some services/applications require inserting information into a form on their mobile phones, while others can deal with short questions about anything, ranging from the weather, to ‘making tomato sauce’! Once the SMS is received by the database, Google’s SMS search technology is employed and the most suitable entry for the query is sent back to the user.

A Revolution in Action

During the testing phase of one of AppLab’s applications, MTN (the participating telecom operator in Uganda) had blocked the service because text messages being exchanged were in quantities too large to handle. To top off this blatant indication of the potential this initiative has, AppLab recently won the award for Best use of Mobile Phones for Social and Economic Development at the Global Mobile Awards, organized by GSMA.

As a result of its success in Uganda, AppLab will soon spread to other areas of the world to offer financial and non-financial services to eliminate poverty through mobile phone technology.

Update: Applab was recently launched in Indonesia as well.