Thank you for all the people who replied and gave helpful advice. It was much appreciated.
If anyone else has the same problem... this is what I did:
The day after I found the phone I just called up vodafone and told them I'd found an Iphone. The guy on the phone asked for some code on the sim card... he found who it belonged to and I gave him my contact number and he contacted the owner and gave the owner my contact number. She contacted me and came to pick it up.
Ps. to the people who said 'finders keepers' and 'who cares..just sell it' etc... the owner was really grateful... she'd passed out on the side of the road and her iphone had fallen on to the sidewalk and the paramedics didn't notice the iphone. it wasn't her fault that she lost it... so me stealing it wouldn't really have been very nice.