Financially Excluded People in Africa to Benefit as The MasterCard Foundation Expands Activities in Rural and Agricultural Finance
US$54 million for financial inclusion initiatives, including US$7 million for innovative projects
AGRF: Lusaka, October 1, 2015—The MasterCard Foundation today announced the initial winners of the first Innovation Competition under its US$50 million Fund for Rural Prosperity. The companies received a total of US$6.9 million for their new approaches in providing financial products and services to poor people and marginalized populations.
“These new made-in-Africa solutions have a good chance of giving poor people in rural areas the financial access they need,” said Reeta Roy, President and CEO of the Foundation. “It was exciting to see so many companies responding to our call for proposals, thinking outside-the-box to figure out low-cost ways to deliver savings, credit and insurance to this population.”
The innovation winners include companies that will implement projects in Burkina Faso, Côte d’Ivoire, Ethiopia, Ghana, Kenya, Mozambique, Senegal, Tanzania and Uganda ( see full list of winning companies attached). Almost 1.7 million people are expected to benefit directly from these projects.
The nine winners were announced at the African Green Revolution Forum (AGRF) in Lusaka. The Foundation also used the occasion to unveil three rural and agricultural finance partnerships totalling US$47 million in support. The list includes a US$15 million Alliance for a Green Revolution in Africa (AGRA) project to help 730,000 smallholder farmer households, particularly women, in Ghana, Kenya and Tanzania access financial support in order to increase farm yields and family incomes.
“This initiative is well-aligned with AGRA’s goal of ensuring smallholder farmers, 65 percent of whom are women, have enhanced access to finance and information to buy farm inputs, invest in post-harvest technologies and pay for storage facilities for their crops,” said Dr. Agnes Kalibata, AGRA President. “Working through financial service providers, mobile network operators, agro-dealers, aggregators, warehouse operators and farmer-based organizations, the project will contribute to improving the profitability of farming enterprises and to overall poverty reduction in the target countries. By focusing on improving financial inclusion, The MasterCard Foundation is definitely addressing one of the weakest links in agriculture systems in Africa.”
More partnerships announced
At AGRF, the Foundation also launched a new US$25 million partnership with Mercy Corps. This project will enable as many as one million smallholder farmers in Kenya, Tanzania and Zambia to access financial services and technical support through digital technology.
“Mercy Corps’ AgriFin Accelerate Program breaks new ground by developing and delivering bundles of digitally-enabled financial and informational services,” said Leesa Schrader, the program’s Director at Mercy Corps. “We are collaborating with The MasterCard Foundation to put smallholders at the centre of product design and innovation, aligning with the interests and capacities of buyers, aggregators, technology platforms and financial service providers as partners in our technical engagement model.”
Finally, the Foundation announced that it is supporting a joint consortium of the Global Development Incubator and Dalberg Associates in the creation of a Rural and Agricultural Finance Learning Lab. The US$6.5 million project will deepen understanding of the financial service needs of smallholder farmers and rural poor families, while also sharing best practices in responding to those needs.
“Given the resources, effort and innovation directed at providing more and better financial solutions for smallholders and other rural clients, it is critical to understand what works and how it affects these clients,” said Jason Wendle, Director of the Rural and Agricultural Finance Learning Lab. “We are excited about the chance to identify lessons and coordinate learning from the Fund for Rural Prosperity and the Foundation’s other investments in rural and agricultural finance, and to lead conversations that enable the broader community of providers to more effectively meet client needs.”
The MasterCard Foundation’s support for agriculture and rural development in Sub-Saharan Africa totals more than $US300 million. An estimated 5.3 million people are expected to benefit from these programs. Because most poor people in Africa live in rural areas, and because there are huge unmet opportunities to increase farm productivity and improve livelihoods, expanding and deepening access to financial services is one of the Foundation’s programmatic priorities.
ABOUT THE MASTERCARD FOUNDATION
The MasterCard Foundation works with visionary organizations to provide greater access to education, skills training and financial services for people living in poverty, primarily in Sub-Saharan Africa. As one of the largest, independent foundations, its work is guided by its mission to advance learning and promote financial inclusion in order to alleviate poverty. Based in Toronto, Canada, its independence was established by MasterCard when the Foundation was created in 2006. For more information, please visit www.mastercardfdn.org or follow us on Twitter @MCFoundation.
Senior Communications Manager, Financial Inclusion
The MasterCard Foundation
AGRA is an alliance dedicated to growing Africa’s prosperity through public and private partnerships that are reaching millions of African farmers and building the capacity of local agriculture businesses. Together with our partners, AGRA works with African farmers to ensure they have the same choices available to farmers elsewhere in the world to successfully grow and sell their food. AGRA seeks to develop and sustain a vibrant agriculture sector that creates new economic and employment opportunities for all Africans. AGRA works across Sub-Saharan Africa, and maintains a head office in Nairobi, Kenya and country offices in Ghana, Mali, Mozambique and Tanzania. Learn more at www.agra.org
ABOUT MERCY CORPS
Mercy Corps is a leading global humanitarian agency saving and improving lives in the world’s toughest places. With a network of experienced professionals in more than 40 countries, we partner with local communities to put bold ideas into action to help people recover, overcome hardship and build better lives. Now, and for the future. www.mercycorps.org
ABOUT RURAL AND AGRICULTURAL FINANCE LEARNING LAB
The Rural and Agricultural Finance Learning Lab fosters knowledge sharing and collaboration that leads to better financial solutions provided to more smallholder farmers and other rural clients. To learn more, see www.raflearning.org
THE MASTERCARD FOUNDATION fund for rural prosperity
2015 Innovation Competition awardees
|Company||Project notes||Project Countries||Estimated number of people with lives improved||The MasterCard Foundation support|
|Biopartenaire||Enabling productivity lending to unorganized and poorer smallholder cocoa farmers through a smart-phone based app.
Field agents will coach farmers on the offer (so that farmers understand terms and conditions) and build farm-level skills. Farmers will be able to open savings accounts. A multi-year track record of growing pre-payments repaid with cocoa deliveries will enable these farmers to enter the financial system.
|Compuscan CRB Ltd||This project is a worldwide first. By including agricultural information into the credit reference bureau, poorer farmers not normally included in the credit reference bureau will be able to access credit for their farms.||Uganda||137,000||$1,000,000|
|SmartMoney Uganda Limited||Piloting a “cash light” approach for rural communities. This project will test the willingness of rural smallholders to move away from cash to digital financial services through integrated payments.||Uganda, Tanzania||700,000||$1,000,000|
|Banque Atlantique Côte D’Ivoire ( BACI)||Serving illiterate farmers in rural areas. This project will allow users to instantly and safely perform all their financial exchanges via a talking app in local languages.||Côte d’Ivoire, Burkina Faso||554,950||$930,083|
|Prepeez Technology Limited||Reducing credit risk and building capacity of rural smallholder food and cash crop farmers.
This holistic, technology-enabled model will support finance and training across a variety of value chains. It will help to increase farmers’ incomes and reduce the risk for financial service providers with the expectation that farmers will be able to access credit as a result.
|Ghana, Côte d`Ivoire||132,000||$892,000|
|Inuka Africa Limited||Financial and technical services for dairy farmers.
This project addresses the needs of dairy farmers and provides a holistic program of support for this sector, including access to best animal breeding, health and feeding practices. The project guarantees farmers regular animal checks and animal inputs and feeds through a network of registered agro vets.
|Kifiya Financial Technology plc.||Mobile financial services for Ethiopian farmers.
Access to finance for smallholders in Ethiopia remains low and the Ethiopian financial market remains challenging. This innovative project will extend mobile money to poor farmers.
|Empresa de Comercialização Agricola Lda (“ECA”)||Finance and technical services for Mozambican farmers.
This project will help expand mobile financial and technical solutions to smallholder farmers.
|Juhudi Kilimo Company Limited||Pioneering credit scoring mechanisms.
This project will use a new method of credit scoring with a series of psychometric tests for credit risk for rural smallholder farmer borrowers who have no or limited verifiable credit information. Pioneered in other sectors, this project will extend it to the agricultural finance sector.