The Impact of E-Services on Socio-Economic Development in South Africa Research Paper

The Impact of E-Services on Socio-Economic Development in South Africa - Research Paper Example Accessibility to e-services has a high potential to add value to marginalized communities (Heeks, 2010), reduce poverty (Cecchini and Scott, 2003) and spur development. However, accessibility is not enough. Other factors must be put into account when making decisions on information technology developments for optimal benefits to all stakeholders and de-marginalization of marginal groups. E-services have revolutionized the global market to levels never imagined before; however, the true impact has not been quantified since the concept is new and has not been widely adopted, nor has it stabilized. Background The World Bank classifies the economy of South Africa as an upper-middle income economy, being the largest economy in Africa in terms of GDP per capita. However, over a quarter of South Africans are unemployed and a similar number lives on less than 1.25 US dollars per day; it is this population that e-services target most since they are primarily unbanked by the conventional comme rce systems. The economy is an amalgamation of primary, secondary and tertiary industries, though it has shifted in the recent years towards being a tertiary economy, an industry that contributes about 65 percent of GDP (OECD, 2010). Despite the continuous growth of the online industry, the country still lags behind the world’s leading economies in terms of volumes and amounts spent in online transactions. Laws and policies passed and implemented in the recent years have increased access to e-services by the population mainly by increasing competition among service providers, which results in reduced prices for accessing and using e-services. For instance, the Telecoms Amendment Act of 2001 introduced a competing network provider for Telkom, such that for the two to attract and retain customers, they had to reduce the costs of their services (Z-Coms, 2002). Elimination of monopoly was the first step towards liberalization of the telecommunications sector, which was achieved b y the Electronic Communications Act (ECA) of 2005. Finally, the Electronic Communication and Transactions Act of 2002 that was aimed at facilitation of e-transactions, e-governance, and other services introduced reliable and universal access to e-services. Context Cieslikowski et al. (2008) state that the world has seen exponential growth in coverage by mobile networks for both developed and developing countries; hence the impact of use of these devices cannot be ignored. For instance, money transfer services whereby money is sent through a mobile network and collected from a local retail outlet, have changed how the low-income communities transfer their money. Before the introduction of services like these, the poor had little or no access to banking and money transfer services, mainly because of high rates or the location of the banking institution in cities. In this case, ICT enabled the rural folk to have access to services that were previously a preserve of the rich. Further ch anges are expected on migration to digital terrestrial television migration, as digital signal will include all communication services bundled. Therefore, everyone will be able to access services with relative ease, and the government will use these channels to communicate matters on policy and development (Gupta and Shah, 2012). However, for these benefits to be enjoyed by the common citizen,