Awareness and use of m-banking services in agriculture: The case of smallholder farmers in Kenya

Smallholder farmer access to agricultural finance has been a major constraint to agricultural commercialization in developing countries. The ICT revolution in Africa has however brought an opportunity to ease this constraint. The mobile phone-based banking services that started in Kenya urban centers have spread to rural areas and even other countries. Using these services farmers could receive funds invest in agriculture finance transactions. This study examines the awareness and use of m-banking services among rural farmers in Kenya. It also assesses the factors conditioning the use of such services. The study finds high awareness of m-banking services among the smallholder farmers. It also finds that education, distance to a commercial bank, membership to farmer organizations, distance to the m-banking agents, and endowment with physical and financial assets affect the use of m-banking services. It discusses the implications of these findings for policy and practice.Mobile phones, m-banking services, awareness and use, smallholder farmers, Kenya, Financial Economics,

The Digitalisation of African Agriculture Report 2018-2019

An inclusive, digitally-enabled agricultural transformation could help achieve meaningful livelihood improvements for Africa’s smallholder farmers and pastoralists. It could drive greater engagement in agriculture from women and youth and create employment opportunities along the value chain. At CTA we staked a claim on this power of digitalisation to more systematically transform agriculture early on. Digitalisation, focusing on not individual ICTs but the application of these technologies to entire value chains, is a theme that cuts across all of our work. In youth entrepreneurship, we are fostering a new breed of young ICT ‘agripreneurs’. In climate-smart agriculture multiple projects provide information that can help towards building resilience for smallholder farmers. And in women empowerment we are supporting digital platforms to drive greater inclusion for women entrepreneurs in agricultural value chains

Mobile technology, farmer education and performance of agricultural projects: A case of the digifarm sunflower project in Makueni County, Kenya.

Mobile technology in agriculture offers an effective and economical means of expanding knowledge sharing and exchange. The purpose of this study was, therefore, to establish the influence of mobile technology on the performance of agricultural projects in Makueni County, Kenya. Specifically, the study remit was mobile applications and mobile money transfers. This study adopted a mixed-methods approach to ensure a comprehensive assembly and triangulation of requisite data to respond to the survey objectives. The target population for this study was all sunflower farmers in Makueni County who subscribed to the DigiFarm platform. The sample size for this study was 208. The results were presented using descriptive statistics and correlations between the variables studied. Mobile applications presented weak positive correlations with the performance of agricultural projects, while Mobile money presented a strong positive correlation with agricultural projects

Innovations in rural and agriculture finance

Most rural households lack access to reliable and affordable finance for agriculture and other livelihood activities. Many small farmers live in remote areas where retail banking is limited and production risks are high. The recent financial crisis has made the provision of credit even tighter and the need to explore innovative approaches to rural and agricultural finance even more urgent. This set of 14 briefs clearly points out the importance of business realities faced by small farmers, including low education levels, the dominance of subsistence farming, and the lack of access to modern financial instruments. These conditions mean that new and innovative institutions are required to reach small farmers. Emerging communication technologies provide new opportunities for rural banking by reducing business costs and alleviating information asymmetries. New financing instruments, such as weather index-based insurance and microinsurance, also have great potential for managing the risks faced by small farmers. In addition, bundling financial services with nonfinancial services like marketing and extension services offers new opportunities for small farmers to increase their productivity and incomes. Finally, an enabling policy environment and legal framework, enforcement of rules and regulations, and a supportive rural infrastructure all contribute immensely to making sustainable access to finance a reality. Table of Contents: •Innovations in rural and agriculture finance: Overview by Renate Kloeppinger-Todd and Manohar Sharma •Financial literacy by Monique Cohen •Community-based financial organizations: Access to Finance for the Poorest by Anne Ritchie •Rural banking in Africa: The Rabobank approach by Gerard van Empel •Rural banking: The case of rural and community banks in Ghana by Ajai Nair and Azeb Fissha •Rural leasing: An alternative to loans in financing income-producing assets by Ajai Nair •Determinants of microcredit repayment in federations of Indian self-help groups by Yanyan Liu and Klaus Deininger •M-PESA: Finding new ways to serve the unbanked in Kenya by Susie Lonie •Biometric technology in rural credit markets: The case of Malawi by Xavier Giné •Credit risk management in financing agriculture by Mark D. Wenner •New approaches for index insurance: ENSO insurance in Peru by Jerry R. Skees and Benjamin Collier •Microinsurance innovations in rural finance by Martina Wiedmaier-Pfister and Brigitte Klein •Combining extension services with agricultural credit: The experience of BASIX India by Vijay Mahajan and K. Vasumathi •Bundling development services with agricultural finance: The experience of DrumNet by Jonathan Campaigne and Tom RauschAgricultural innovations -- Developing countries, agriculture finance, Financial crisis, microinsurance, Poverty reduction, rural banking, Rural finance, Rural households, Small farmers,

ICT Update 77: Linking farmers to markets

ICT Update is a bimonthly printed and on-line magazine (http://ictupdate.cta.int) and an accompanying e-mail newsletter published by CTA. This issue focuses on linking the farmers to markets

Final technical report of eARN Africa Project / eAgriculture Research Network : effectiveness of ICT-based interventions in linking African farmers to markets

Attempts to improve smallholder farmer access to efficient markets have recently shifted to ICT-based interventions. ICT-based market information services help reduce transaction costs in most of the study countries through: search and screening costs (easier to find a seller/buyer, and compare prices in distant markets); negotiation costs (costs of agreeing on the terms of exchange); and monitoring costs (costs of following up on the transaction arrangements). The eARN project contributed towards an ICT in Agriculture e-source book published by the World Bank titled: “ICT in Agriculture: Connecting smallholders to markets, networks and institutions.” eARN also supported and mentored participating researchers

Technology for Good: Innovative Use of Technology by Charities

Technology for Good identifies ten technologies being used by charitable organizations in innovative ways. The report briefly introduces each technology and provides examples of how those technologies are being used.Examples are drawn from a broad spectrum of organizations working on widely varied issues around the globe. This makes Technology for Good a unique repository of inspiration for the public and private sectors, funders, and other change makers who support the creation and use of technology for social good

Scaling up index insurance for smallholder farmers: Recent evidence and insights

This report explores evidence and insights from five case studies that have made significant recent progress in addressing the challenge of insuring poor smallholder farmers and pastoralists in the developing world. In India, national index insurance programmes have reached over 30 million farmers through a mandatory link with agricultural credit and strong government support. In East Africa (Kenya, Rwanda and Tanzania), the Agriculture and Climate Risk Enterprise (ACRE) has recently scaled to reach nearly 200,000 farmers, bundling index insurance with agricultural credit and farm inputs. ACRE has built on strong partnerships with regional initiatives such as M-PESA mobile banking. In Ethiopia and Senegal, the R4 Rural Resilience Initiative has scaled unsubsidized index insurance to over 20,000 poor smallholder farmers who were previously considered uninsurable, using insurance as an integral part of a comprehensive risk management portfolio. With strong public and private sector support, the Mongolia Index-Based Livestock Insurance Project (IBLIP) insures more than 15,000 nomadic herders and links commercial insurance with a government disaster safety net. Finally, the Index-Based Livestock Insurance (IBLI) project in Kenya and Ethiopia demonstrates innovative approaches to insuring poor nomadic pastoralists in challenging circumstances. A few common features appear to have contributed to recent progress within these case studies: explicitly targeting obstacles to improving farmer income; integration of insurance with other development interventions; giving farmers a voice in the design of products; investing in local capacity; and investing in science-based index development. Evidence from these case studies can inform the ongoing debate about the viability of scaling up index-based insurance for vulnerable smallholder farmers in the developing world. The rapid progress observed in recent years suggests that index insurance has the potential to benefit smallholder farmers at a meaningful scale, and suggests the need to reassess arguments that lack of demand and practical implementation challenges prevent index-based insurance from being a useful tool to reduce rural poverty

Innovative Financial Technologies to Support Livelihoods and Economic Outcomes

There is a growing body of literature on digital financial services, consisting primarily of peer-reviewed journal articles and donor reports. Much of the literature centres on Africa - particularly on Kenya, where mobile technology is widespread. There are various gaps, however, on the outcomes of such services (see Islam et al., 2016). While there is much literature, which asserts that digital financial services improve financial inclusion, there is little empirical evidence that establishes the links between digital finance and financial inclusion (Ozili, 2018). In addition, few studies have explored the relationship between mobile money use by firms, on the one hand, and private investment, firm profitability, and/or access to finance, on the other (Islam et al., 2016)