More than 2 billion people worldwide live in rural households engaged in smallholder agriculture. One of the key challenges these farmers face is the lack of access to finance. This is due to physical barriers, such as long distances to reach a bank branch, but also to the lack of conventional collateral such as land titles. Can digital technologies help to overcome these barriers? This session will present and critically discuss efforts to extend digital financial services to smallholders and integrate them into agricultural value chains.
In the last decade, a great number of digital tools were developed to help farmers access the information they need and promote transformative agricultural development. According to the World Development Report 2016, many of these tools have not lived up to the expectations. Thus, for digital technologies to reach their target groups and improve their livelihoods, we must discuss and share the lessons learned.
In this session, we will share our experience gained with “SAP Rural Sourcing Management”, a cloud-based mobile application for agricultural value chains. The system records transactions such as farmer registration, prepayments, input supply, grading, purchase, logistics and payments in the field and synchronizes them in real time via smartphone. Further applications support data analysis, facilitate operational field support and ensure traceability. Since 2012, more than 100 000 small-scale producers have been registered in numerous field pilots in Benin, Burkina Faso, Côte d’Ivoire, Ghana, Mozambique and Uganda in the commodities cashew, cocoa, coffee, rice, sesame and shea nut.
We will highlight the experience of Ugandan coffee farmers, who use the system to digitally track their buying and selling transactions, thereby generating transaction-based reports and track records which serve as proof of income. Based on this example we will discuss and debate the following questions: Can the information gap between smallholder farmers and financial institutions be overcome on the basis of track records of deliveries and income of individual farmers from value chain management? What is the role of sensitization and training for farmers? What are the obstacles to widespread adoption of digital financial services for smallholder farmers?
The speakers will provide insights into their project work, discussing opportunities and challenges of ICT solutions for smallholder farmers and also present a live demonstration of the SAP system.