GSM Payphones Bring Communications to Rural Communities

MTN Rwanda says that in the past year, it has provided over 1,600 GSM based payphones for rural communities, bringing communications to areas that are often not served by landline phone networks. The company reports that original forecasts for the rollout of Tuvugane exceeded expectations. At inception 600 payphones were rolled out in rural Rwanda and today more than 1,600 payphones have been distributed by MTN.

Says Yvonne Muthien, Group Executive: Corporate Affairs, MTN Group: "MTN Rwanda is committed to the delivery of quality, innovative services while playing a leading role in the socio-economic development of the country. The Tuvugane initiative is part of MTN's drive to increase teledensity in rural areas throughout its operations and put telecommunications within the reach of even those who cannot afford handsets.

"In addition, this project has created many entrepreneurs who are either running the business themselves or creating employment for others in turn. All this is in line with MTN's commitment to empower the communities in which we operate," says Muthien.

The Tuvugane service offers the most affordable rates for mobile and international calls in the country and is available where MTN has coverage, putting telecommunications within reach of 95% of the population living in rural areas.

Rural entrepreneurs rely on micro-financing assistance from locally-based lenders to purchase the Tuvugane payphone and start a personal business of selling airtime units to the local community. These entrepreneurs are located throughout the country for easy accessibility by the general public.

Airtime is sold for US$36 per bundle and entrepreneurs can buy bundles of airtime for US$31. Entrepreneurs therefore make US$5 on every bundle of airtime that they purchase.

Users of the Tuvugane payphone tell the reseller how much they are willing to spend and the reseller will enter the value into the phone, this way users will know exactly how much their conversation will cost.

"Within one year the project produced better than expected results, significantly contributing to bridging the digital divide. In addition to providing a platform from which the community can communicate, MTN Rwanda has successfully empowered the people of Rwanda and contributed to job creation and local entrepreneurship in the country. Going forward MTN Rwanda will further subsidise airtime enabling resellers to make even more profit," says Muthien.

Tuvugane mirrors the VillagePhone initiative currently deployed through MTN in Uganda which helps connect villagers to those outside the village. Innovative phone bureau set-ups are installed in areas where electricity is unavailable, offering connectivity to poorer communities.

Through its community payphone initiatives MTN focuses it efforts on lowering the financial and geographic barriers to telecommunications access in all the countries where it operates.

Cellular services have become an indispensable communication tool in Rwanda; before MTN's arrival six years ago, there were only 20,000 fixed telephone lines. MTN currently has 175,000 subscribers in Rwanda and continues to expand its network coverage in rural areas which had been considerably underserviced prior to the introduction of Tuvugane."

Posted to the site on 4th March 2005