MasterCard foundation partners AGRA on agric financing

The Alliance for a Green Revolution in Africa (AGRA) has commended the MasterCard Foundation’s pronouncement of investing $47 million in agricultural finance projects across Africa, including $15 million for a partnership with AGRA that will deliver financial support to 730,000 farming households. AGRA’s President Dr. Agnes Kalibata while speaking Thursday in Lusaka, Zambia at the MasterCard Foundation Award Ceremony, said the initiative is well-aligned with AGRA’s goal of ensuring smallholder farmers have access to finance and information to buy farm inputs, invest in post-harvest technologies, and pay for storage facilities for their crops. Dr. Agnes Kalibata added that “by focusing on improving financial inclusion, the Foundation is definitely addressing one of the weakest links in African agricultural systems.” AGRA boss said Africa cannot develop with its large population excluded financially, adding that what the continent needs is financial solutions tailored to the need of the farmers, “not that African farmers cannot produce but they lack the financial means.” Dr. Kalibata said AGRA working through financial service providers, mobile network operators, agro-dealers, aggregators, warehouse operators, and famer-based organizations, the project will contribute to improving the profitability of farming enterprises , thereby, reducing poverty in targeted countries. She called on financial institutions to understand some challenges in the African society while trying to encourage financial solutions to agriculture, “in our culture we were all brought up to be self reliant…to the extent that borrowing can feel almost like a crime,” she said. “In the real world, people borrow money, but that is not the culture in Africa. And financial institutions need to understand these challenges.” The President and CEO of the MasterCard Foundation, Reeta Roy, used the event to announce the initial winners of the first innovative competition under its $50 million fund for rural prosperity. He disclosed that nine winning companies received a total of $6.9 million for their new approaches in providing financial products and services to poor people and marginalized population. Reeta Roy said “These new made-in-Africa solutions have a good chance of giving poor people in rural areas the financial access they need. 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 projects include an effort by Banque Atlantique of Côte d’Ivoire to develop a voice-activated app that will enable illiterate farmers to conduct financial transactions, and a venture by Smart Money in Uganda to encourage smallholder farmers to move from cash to digital financial transactions. The Foundation also launched a new US $25 million partnership with the development NGO Mercy Corps to use information technology to bring financial services to one million smallholder farmers in Kenya, Tanzania, and Zambia. The Foundation also unveiled a new $6.5 million alliance with Global Development Incubator and Dalberg Global Development Advisors to create a new Rural and Agricultural Finance Learning Lab. Jason Wendle, director of the Learning Lab said the $6.5 million Learning Lab project will deepen understanding of the financial service needs of smallholder farmers and rural families. He added that the key challenge today in Africa is create financial services for smallholder farmers that are “commercially sustainable but also pull smallholder farmers out of poverty.”