In addition to hoes and shovels, more and more farmers in sub-Saharan Africa carry another agricultural “tool”: a cell phone.
Over the last decade, cell-phone use in Africa has increased fivefold, and farmers are using their phones to gain information about everything from markets to weather. For example, farmers can find out prices before they make the long trips from rural areas to urban markets, giving them the option to wait to sell until prices are higher. Agricultural extension agents and development agencies also use mobile phones to communicate with farmers, letting them know about changes in weather that could affect crops.
Farmers and agribusiness agents in Zambia are also using cell phones as bank accounts, to pay for orders, to manage agricultural inputs, to collect and store information about customers, and to build credit. Mobile Transactions, a financial services company for the “unbanked,” allows customers to use their phones like an ATM card, says Mike Quinn, Mobile Transactions General Manager. An estimated 80 percent of Zambians, particularly in rural areas, don’t have bank accounts, making it difficult for them to make financial transactions such as buying seed or fertilizer. But by using Mobile Transactions, farmers are not only able to make purchases and receive payment electronically, they are also building a credit history, which can make getting loans easier.
Mobile Transactions also works with USAID’s PROFIT program to help agribusiness agents make orders for inputs, manage stock flows, and communicate more easily with agribusiness companies and farmers. Perhaps most importantly, the partnership helps agents better understand the farmers they’re working with so that they can provide the tools, inputs, and education each farmer and community needs.
In addition, e-banking and e-commerce systems can help make better use of agricultural subsidies. Mobile Transactions worked with AGRA and CARE to develop an e-voucher system for obtaining conservation farming inputs. Farmers receive a scratch card with funds that they can redeem via their phones to purchase tools or other inputs from local agribusiness agents. Unlike paper vouchers, there’s no delay in moving the money, and farmers can get what they need immediately, such as seed during planting season or fertilizer when it can be used most effectively. And because donors are using Mobile Transactions to distribute the vouchers, they’re acting as a stimulant to the private sector, rather than distorting the market.