UN study highlights digitization of farmer payments in Kenya

Ugo Okoro

A new case study by the United Nations-based Better Than Cash Alliance shows how agriculture nonprofit organization One Acre Fund , in partnership with Citi Inclusive Finance, successfully digitized loan repayments for farmers in Kenya.

This move significantly boosted transparency and efficiency, driving economic opportunity and financial inclusion for thousands of smallholder farmers and their families.

One Acre Fund, supported by Citi, enabled farmers to easily make loan repayments via mobile money instead of cash, reducing the uncertainty, inefficiency, insecurity and high costs previously caused by cash transactions.

One Acre Fund can now reach more farmers with greater reliability, and staff can spend almost half as much time collecting payments in cash, using that extra time to help farmers increase their incomes through training and educational programs.

With One Acre Fund’s package of services, including training and inputs like seed and fertilizer, the average farmer participating in the program earned nearly 50 percent more than peer farmers who do not participate.

Mobile repayments have allowed us to increase our efficiency and provide better service to farmers,” said Mike Warmington, the Director of Microfinance Partnerships at One Acre Fund. “We’re excited to be working at the forefront of this technology in the smallholder agriculture lending sector. In our experience, farmers were empowered to thrive in these communities. Clients receive immediate confirmation of payments as they happen, enabling them to better manage their businesses and family finances.

One Acre Fund is an example of the significant benefits and impact that digital payments and inclusive digital financial infrastructure, as developed in Kenya, can bring to agricultural value chains, contributing to a more sustainable and productive agriculture sector, a cornerstone of the UN’s Sustainable Development Goals (SDG).

These learnings can easily translate to poor farming communities in other countries and One Acre Fund is working on plans to expand in Rwanda, Tanzania, and Zambia in the future.