In the next five years, Safaricom’s mobile agriculture platform DigiFarm will outgrow M-Pesa at least according to the company’s outlook. DigiFarm which currently has more than 200,000 farmers using the service daily was launched in partnership with Farmdrive, iProcure and Arifu. The platform which aims at digitising entire agriculture value chains in Kenya has 7,000 farmers successfully taking loans using the app.
This money is usually spent on purchasing seeds, fertilizers and pesticides.
The M-Pesa Ecosystem
Safaricom Chief Financial Services Officer, Sitoyo Lopokoiyit, says that DigiFarm has grown phenomenally since its launch in October 2017. So far, the platform has over 1 million farmers registered.
“In line with our Purpose of Transforming lives, we have provided a mobile technology platform for the smallholding farmers to access a suite of information and financial services, said Lopokoiyit.
Within DigiFarm, farmers can access credit and other financial facilities. These farmers can also share information for instance between themselves and processors. They can also discuss issues like expected yields. Interestingly, all financial transactions take place within the M-Pesa ecosystem which bolsters confidence among users.
Lopokoyit, who was speaking during the Afro-Asian Fintech Festival in Nairobi added, “Using the mobile technology platform, smallholder farmers get access to information on financial services. They also receive discounted products, customized information and tutorials on farming practices.”
With the Fintech sector in Kenya attracting funding continually and increasingly, Safaricom says more growth is expected on this platform. Agriculture is Kenya’s biggest employer with the 2019 Economic Survey placing the figure at 34.2 per cent of the total value. To ensure maximum benefits, Safaricom says it is exploring an end-to-end buyer model. This will ensure that the farmers have guaranteed access to ready markets for their produce at a fair price.
DigiFarm is projected to be worth the whereabouts of USD 1 billion by 2020.
Enlisting farmers on DigiFarm
In March, Makueni County entered into a partnership with DigiFarm and Bidco Africa to provide a ready market for 640 farmers. These farmers were the first beneficiaries of the end to end buyer-driven model. Through this plan, Bidco Africa provides a ready market for the farmers’ produce which is used as raw materials in the processing of edible oils. Bidco Africa says that partnering with farmers is about empowering them since they form about 70 per cent of the population.
The arrangement comes as the company is expanding its farmers’ base. Last year Bidco announced it was planning on contracting 25,000 farmers to grow sunflower and soya beans. This contract farming is meant to curb the shortage of the two commodities used in making oil.
Bidco Africa has 25,000 contracted farmers supplying 5,000 tonnes of sunflower and soya beans against a demand of 10,000 metric tonnes annually.
John Kariuki, Bidco Africa’s head of agribusiness said last that, “the company will contract farmers, offer technical support and a ready market once the harvest is ready.”
The 640 sunflower farmers in Makueni County are set to benefit from a partnership between Safaricom’s DigiFarm, Bidco Africa and the area’s county government. They are the first beneficiaries of an end to end buyer-driven model where Bidco Africa will provide a ready market for their produce which is used as raw materials in the processing of edible oils.
“We are glad that we are able to help farmers actualise their dreams through DigiFarm by providing an end to end process that will ensure that farming becomes a profitable venture that will eventually uplift their living standards. We hope to continue to engage more farmers with different crops so that we can help them reap maximum benefits,” Said Rita Okuthe, Chief Enterprise Officer, Safaricom.
Makueni is the first county to pilot the end to end value chain from registration of farmers to access a ready market.
Safaricom’s DigiFarm depots
In May last year, Safaricom opened a Digifarm depot in Burnt Forest Town, Uasin Gishu County. The depot was part of the company’s efforts to encourage more smallholder farmers to transition into agribusiness. Through the depot, farmers have opportunities to access farm inputs and sustainable markets.
Despite 80 per cent of Kenyans living in the rural areas engaging in agricultural activities, only 18 per cent of them uses certified seeds and fertilisers. The depot targets farmers in and around the county with seeds, animal feeds, fertilisers and agricultural chemicals.
Source: The Exchange