Across Africa, mobile phones have become the operating system of everyday economic life
Across Africa, mobile phones have become the operating system of everyday economic life. Before sunrise, farmers check prices, parents send school fees, and traders move money across borders with a tap. Mobile data usage is growing faster than anywhere else in the world, and the continent’s demographic momentum means demand will continue to grow.
Africa will not be left behind due to lack of users. The risk is that development policy still treats digital access as a consumer choice, even though it functions as economic infrastructure in many places. In a mobile-first economy, digital connectivity underpins payments, commerce, access to services, and increasingly individuals’ ability to build their economic footprint. In areas where roads, banks, and state delivery systems are weak, the network has become a platform for participation.
In Somalia, communications infrastructure is already doing its part. Private investment built nationwide 4G mobile coverage, connected the country to the world’s fiber optics, and built the mobile money rails that homes and businesses rely on every day. This is the kind of backbone that will require decades of public investment in many countries.
However, fundamental limitations still remain. Millions of people understand the digital economy, but are unable to take full advantage of it. A far fence is not a must. A telephone receiver in your pocket.
Without smartphones, citizens struggle to access digital aid payments, online learning, mobile-first jobs, and services that rely on apps rather than SMS. You cannot easily create a transaction history that will help you qualify for credit, insurance, or formal financial products. The result is a widening gap between those who can turn connections into opportunities and those who are connected in theory but excluded in practice.
This is where development thinking has not caught up. Smartphones are not public goods in the technical sense. It’s a private device. But its economic value has significant ramifications. Ensuring households have access to digital payments reduces transaction costs. Working capital is improved when traders can compare prices and receive funds instantly. When people are able to verify their identity and build transaction records, lenders can more accurately price their risks. Because its benefits extend beyond the individual user, device access falls into the category of infrastructure that promotes productivity and inclusion.
In many markets, the problem is not demand. It’s reasonably priced. In economies where income is irregular, savings are limited, and formal credit is scarce, smartphones require large upfront payments. In Somalia, the initial cost of a smartphone is at least one-sixth of the average annual income. It creates market failure. Although the social benefits are high, private funding does not reach the households that benefit most.
Properly designed device financing can solve this problem. Spreading the price of a mobile phone into small recurring payments, often paid with mobile money, can turn a one-off barrier into a manageable contract. It also creates a structured pathway into the formal economy. A payment plan builds a foundation of discipline, transaction records, and creditworthiness.
The practical challenge is scale. Rolling out device financing to people who really need it requires significant capital and comes with real risks. Income shocks, evictions, fraud, and weak consumer protections can all turn a well-intentioned program into a bad one. This is precisely why development finance institutions should treat device access not as a charity but as a matter of risk avoidance.
The infrastructure to make this happen is already in place. Mobile network operators have the systems needed for distribution, customer relations, payment rails, and repayment management at scale. In Somalia, companies like Hormuud can deliver devices, collect payment through mobile money, and use transaction patterns to assess affordability and reduce the risk of default. What is lacking is not operational ability. It is risk capital that seeks to absorb shocks so that loans reach low-income households.
DFI is built for this role. They can offer first-loss guarantees, blended financing structures, or portfolio insurance that make it reasonable for private capital to finance large-scale mobile access. With the right structure, DFIs do not need to subsidize every device. They need to assume the risks that prevent markets from serving the poorest and most marginalized people.
Foundations and international NGOs on the ground also have a clear role to play. They know the community. These help focus support to households with the highest development benefits. They strengthen consumer safety measures, support digital literacy, and help ensure devices lead to real outcomes, from access to benefits and schooling to more resilient lives.
This partnership model is simple. Operators deliver results, NGOs enable them, and DFIs avert risks. It aligns incentives, avoids building parallel systems, and recognizes the reality that digital infrastructure is already embedded in everyday life. The objective is not to pick winners in the communications market or lock users into one platform. Programs must be designed with interoperability, transparent terms, and strong consumer protections in mind to ensure access to devices strengthens rather than weakens competition.
Africa’s digital decade has already created a market. The next step is to ensure that the implementation progresses in time. If development finance updates its definition of infrastructure to include access to devices, it could unlock a greater share of the economic benefits that Africans are already generating. The question is no longer whether the demand exists. It’s whether you choose to fund the last mile.
This article was written by Mohamed A. Farah, CEO of Hormuud Telecom.
