To get a sense of how microenterprises use technologies and what we know about the impact of technologies on the livelihoods of microenterprises, it’s best to stop thinking about “a mobile phone”. This is difficult because the mobile handset is the ubiquitous game changer. It’s the device/technology that has done the most to open new possibilities to the microenterprise market segment. Moreover, micro-entrepreneurs were among the earliest adopters of mobile phones in many emerging markets and were quick to see their value.

But what is the value? Because the mobile handset is many things, we’ve  outlined its discrete functions:

• The value of a phone call is the oldest and most demonstrable. Phone calls substitute for journeys allowing people to exchange information and coordinate activities at a distance. This has direct implications for productivity and the creation of functioning markets wherein everybody knows the going price for their products.¹ Mobile technologies “leapfrogged” fixed line installations in the developing world due to better economics: it is less expensive (for both the telco and the user) to add connections to a mobile network than to dig/string new fixed lines to homes and businesses.
• The value of a mobile phone call is newer. Whereas landlines allow people to call places, mobile’s allow people to call people. This is a remarkable, newer advantage for small enterprises without a fixed place of business—such as people who work on call or travel to job sites.²
• Mobile phones, even basic ones, allow for text messaging and, more recently, for IP-based chat like WhatsApp or Facebook messenger. Asynchronous, text-based messaging is a cost-effective complement to the requirements of a person-to-person phone call. Micro-entrepreneurs can use these channels incredibly effectively to cultivate and maintain business ties over  distance, to signal that products or services are ready for delivery or for sale, and to exchange all kinds of information about the markets in which they participate.³
• Mobile phones, even mid-range ones, grant access to the Internet and the World Wide Web. The web is a source for business information. It’s better in big languages than small, better for some markets than others, but there’s no doubt that having access to Google, YouTube, Wikipedia, and more puts a lot more information in the hands of micro-entrepreneurs. It also increases the visibility/discoverability of many businesses to potential customers.
• A litany of business services now run on apps—everything from small-scale accounting and inventory management to translation services and design tools. Not every business needs every app, but almost every business can benefit from one or two apps that have been tailored for a given sector.⁴ For example, TechnoServe’s Smart Duka program helps shopkeepers in Kenya manage inventory and recordkeeping.⁵
• Mobile money and digital financial services offer a distinct and important set of functionality to MSMEs⁶—in some geographies more than others.
• Relatively recently, we have seen the emergence of specialty apps and websites, or sometimes even simply text messages, that create virtual marketplaces.⁷ These are the platforms creating new markets for buying and selling.
• And don’t forget the flashlight, or the radio, or the camera. Each little addition to the suite of tools available on a mobile handset can serve micro-entrepreneurs.

Of course, not all microenterprises can take advantage of all technologies in the same way. The various services described above (phone calls, asynchronous messaging, findability, information processing and storage, information and training, business services, and digital marketplaces/platforms) are useful in different combinations in different industry sectors. What makes sense for the motorcycle repair specialist (who may need a mobile phone to be on-call all the time) might not make sense for an accountant (who needs a spreadsheet, a mouse, and a bigger screen). What’s best for retail isn’t best for a wholesaler or a middleman.

Similarly, differences in skills/literacies, attitudes, and approaches to technology mean that not everybody will make use of the same tools as effectively.⁸ “Situated practices” match learned, yet informal craft to specific, complex contexts,⁹ often via side hustles that defy easy categorization into single livelihoods.¹⁰ To fail to account for this is to fail to appreciate the ways in which technologies don’t “impact” people so much as people react to and use technologies. We will explore some of this in the practices and digital literacies sections elsewhere in the report.

For all of the reasons discussed above, when one claims that “a phone” helps “a business”, it’s important to ask “how?” and “which business?” Indeed, the evidence for how the various functions of the mobile phone are impacting the landscapes for inclusive participation in marketplaces is mixed. So far, middlemen don’t seem to have disappeared so much as shifted. So too, mobile phones don’t seem to help people start new businesses so much as they help people run their existing businesses more effectively.¹¹ But given the scope of this topic, these technologies being used in a myriad of ways by hundreds of millions of people around the world, the evidence is still fairly scarce and inconclusive.¹²

All told, it’s clear why we need to revisit ICT use by micro-entrepreneurs: to reflect on the arrival of the platform era. As good as it is, the research we have hasn’t done enough to demonstrate the impact of these new technologies, especially these new online marketplaces, on the livelihoods of small enterprises. Just because we know how a small business makes phone calls, sends text messages, or keeps its books digitally doesn’t mean that we know how successful that business will be in navigating new online, platformitized markets, mediated by algorithms and inscrutable processes, filled with opportunity but rife with new forms of competition. Although we can draw on scores of studies that illustrate how basic mobile telephony has done more to amplify existing business structures than to transform them, these studies are not really applicable to an era when almost any business can use WhatsApp, put up a Facebook page, browse Instagram for design ideas, or even set up a virtual shop on a trading platform. This study explores how platforms (Google, Facebook, Alibaba, etc.) create new models for (and avenues to) financial inclusion, and is thus among a much smaller set of precursors¹³ to what we hope will become a broad line of inquiry.