The emergence and expansion of digital infrastructure in even the hardest to reach rural regions of Kenya, Tanzania and Ghana are making the delivery of financial services to rural communities much cheaper and less risky. Physical infrastructure is no longer required in order to reach farmers, bringing down the cost for providers to serve them. And as more data on smallholder farmers becomes available for analysis, certification and rating purposes, the transactional risks are also reduced. There is significant scope, therefore, for digital tools to play a role in facilitating assured markets, contracts, extension, information, price transparency and facilitating access to finance for smallholder farmers in these three markets.
Since 2015, AGRA, in partnership with the Mastercard Foundation, has provided matching grants and technical expertise to 22 partners to accelerate their innovative business models for (financial) service delivery to small scale staple crop farmers in Ghana, Kenya and Tanzania. The grant and technical assistance helps partners explore, pilot and scale digital financial and non-financial solutions for smallholder farmers. As this initiative enters its final year, AGRA has developed a series of learning briefs which share lessons learned in the following areas:
1. Digital payments to enable rural financial inclusion in Northern Ghana
2. Supply chain finance and digital payments for staple crop farmers in Kenya
3. Digital platforms to support improved structuring of markets in Kenya
4. Flexible layaway schemes to facilitate access to inputs for farmers in Tanzania
5. An m-Commerce solution in rural Ghana to improve farmers’ access to finance, quality inputs, know-how and output markets
These projects were varied in their objectives and results, however a few cross-cutting lessons stand out:
In addition to these five learning briefs, AGRA has also published two shorter pieces. The first explores advances made by two emerging digital platforms delivering a range of services to smallholder farmers in Kenya – Safaricom’s Digifarm and KCB Bank’s Mobigrow. It also reflects the progress and hurdles confronting digital agri-service platforms in comparison to urban digital finance models.
Digital Platforms for Agriculture in Africa Create New Opportunities for Access to Finance
The second piece tackles the topic of building sustainable rural digital finance ecosystems. AGRA’s work with rural agents in Ghana and Tanzania provides insights into the shifting scene for rural payment ecosystems, and reveals how the business case for agents is evolving as agricultural payments transition to digital channels.
Ghana and Tanzania – Opportunities and Challenges for Rural Digital Finance
Alliance for a Green Revolution in Africa (AGRA) facilitates FISFAP, an initiative that aims to reduce food insecurity and increase the incomes of about 700,000 smallholder farmers in Kenya, Tanzania and Ghana by February 2020 by working with financial institutions and agriculture value chain actors.
Press release: AGRA and The MasterCard Foundation partnership
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