It has always been a source of immense pride for me to have been part of the group of conference participants who were there at the initial launch of M-Pesa, back in 2006. Indeed, when I look at what M-Pesa has been able to do in the financial and technological sectors in Kenya, and then Africa, I feel a sense of pride to have been there at the dawn of a financial revolution.
Introducing the zSIM
However with the arrival of the zSIM from bitSIM, it now seems that even M-Pesa must now give way to this new kid on the block. bitSIM has announced the release of a new thin card that can be added to any SIM card, converting the SIM card into a fully encrypted hardware bitcoin wallet. The zSIM works on any phone device, smartphone or not.
CCN had a chat with Mr Leon-Gerard Vandenberg, and he explained what zSIM would be able to do
“We solve three things on the zSIM hardware solution. One, seamless mobile identity; two, secure blockchains (digital assets) and three, secure bitcoin / altcoin wallets.”
The potential for this technology is immense. The bitSIM website lists applications in mBanking, mCommerce, mRemittance as well as gaming and other infotainment apps. In the interview mentioned earlier, Mr Vandenberg pointed out one way in which banks could make use of the bitSIM.
He further adds that,
“as the innovation cycle ramps up with the bitcoin and blockchains, we see bitSIM being a triple play platform for deployment that is pivotal around identity.”
Globally, close to 2.5 billion adults remain unbanked. The vast majority of them live in Africa, Asia, Latin America and the Middle East. However, the bitSIM would enable this huge market to be brought into the formal financial sector literally overnight. Mr Vandenberg says that
“if banks spawn green addresses for every customer, then they can track all transaction flows.”
Running Into Headwinds
Heady as the plan is, it is likely to run into headwinds if the case involving Equity Bank and Safaricom in Kenya, is anything to go by. Safaricom has been engaged in a court battle with Equity Bank that had introduced the thin SIM for its customers. Safaricom’s claim was that transactions done via the thin SIM were going to be risky for M-Pesa customers.
However, other analysts charged that all that Safaricom was doing, was protecting its 19-million strong M-Pesa market. This case serves as a bellwether of what bitSIM might eventually face.
Competition Between Telcos and Banks
The emerging global financial stage will see increasing competition between telcos and banks for control of the market share. bitSIM being able to compete against one of them promises to become a third force that will eventually muscle out the first two. bitSIM might even go further. Since the technology is built on the block chain, it effectively eliminates the middleman that exists both in banking and in the telcos and potentially promises much, much lower fees for transactions.
For many developing countries, bitSIM could enable many other industries to really take off including mCommerce and mRemittance, or even mRebittance. Remittance has become one of the main sources of income in many developing countries, something that has made governments take notice.
Potential for African Economies
The revolution could also happen in other sectors of the economy such as agriculture. In recent years, Nigeria, Africa’s largest economy, has been able to undertake significant reforms that have made agriculture a vibrant sector once again in that country. bitSIM would enable the reforms undertaken in Nigerian agriculture to be spread overnight to other countries around the world.
For example a dedicated agro-blockchain could be created that could be used to manage all aspects of the value chain including smart contracts, and even the development of a viable continental commodity trading for African regions or even the continent itself. Trade on this agro-blockchain would be enabled across borders via the bitSIM without the usual bottlenecks that are inherent in traditional banking.
It is my belief that bitSIM promises to change radically the way we live and play. Many of the applications that could be powered on top of the bitSIM may be unimaginable as at now. For example, what role would bitSIM have in powering an internet of blockchains or even an internet of things?
However, as this product goes to market it is going to change the nature of business, something on which Mr Vandenberg concurs when he says,
“we want to enable trade.”