- Mastercard and Ecobank Group’s partnership will connect millions of small-scale farmers in Sub-Saharan Africa to Farm Pass
- In Sub-Saharan Africa, more than 60 per cent of the population is comprised of small-scale farmers, and the agricultural sector is anticipated to provide 23 per cent of the continent’s GDP
- Farmpass digital transaction records can then be used to make formal credit or other financial services available from banks and other financial institutions easier to get.
Farm Pass is a digital platform that makes it safer and more accessible for farmers to sell their produce at a fair price.
Mastercard and Ecobank Group’s partnership will connect millions of small-scale farmers in Sub-Saharan Africa to Farm Pass.
As part of the cooperation, Ecobank will leverage its presence across 33 countries in Africa to broaden the scope of the Mastercard Farm Pass platform and increase the positive impact it has.
Many small-scale farmers in Sub-Saharan Africa are confronted with a variety of difficulties; there is restricted access to markets, working capital to finance activities or obtain quality inputs, and applicable financial tools to pay and be paid in an effective manner. These are some of the challenges which have resulted in insecurity, a waste of food and resources, and inefficiencies, making it impossible for farmers to run sustainable enterprises.
Farm Pass is an agricultural marketplace that brings together various agri-sector players, both on the supply and demand sides, enhancing the positive influence that these stakeholders have collectively on farming communities.
Smallscale farmers can increase the price at which they sell their produce, gain access to high-quality inputs and information regarding farming, receive payments and make payments digitally, and develop a financial profile that can unlock opportunities for financing working capital and inputs.
Farm Pass gives smallscale farmers the ability to construct a digital transaction record for their enterprises by linking them with payment systems. This record can then be used to make formal credit or other financial services available from banks and other financial institutions easier to get.
In Sub-Saharan Africa, more than 60 per cent of the population is comprised of small-scale farmers, and the agricultural sector is anticipated to provide 23 per cent of the continent’s GDP, as stated by McKinsey & Company. However, just 3% of the industry is eligible for banking credit, which severely restricts the ability of farmers to expand their businesses or reduce the impact of unfavourable harvests.
“In contemporary times, ensuring food security is a requirement that is both vital and urgent. As a result, we are going to have to step up to the challenge and create chances for growth in Africa’s agriculture value chain. Our collaboration with Mastercard has arrived at the perfect time to hasten the process of providing smallholder farmers in Africa with access to the essential financial services they require.
These services are essential to the achievement of Africa’s full agricultural potential. According to Ade Ayeyemi, the chief executive officer of Ecobank Group, “It will also assist deliver value across the farming and agricultural value chain, which will make farming in Africa more profitable, resilient, and competitive, ultimately contributing to the expansion of the continent’s economy.”
“When we give people more agency, we are able to energise economies and enable economic expansion that is really inclusive.” The digital infrastructure that is provided by Mastercard Farm Pass contributes to this goal by making it simpler for smallholder farmers to transition from subsistence farming to farming for commercial purposes. In turn, this will encourage the growth of agriculture, promote competitiveness, and lead to an improvement in food security in Africa. According to Michael Froman, Vice Chairman and President of Strategic Growth at Mastercard, “through tight relationships with significant partners like Ecobank, we can create even more impact, putting the digital economy to work for everyone, everywhere.”
“The Mastercard Farm Pass collaboration with Ecobank Group fits in well with the intention of the newly agreed Africa Emergency Food Production Facility (AEFPF). It aims to help countries increase the production and productivity of important staples on the continent.
This facility was recently approved by the African Development Bank. According to Solomon Quaynor, Vice President for Private Sector, Infrastructure and Industrialisation for the African Development Bank Group, “one of the key activities of AEFPF is to connect farmers through e-wallet systems. This involves digitising the procurement of agro-inputs and, at the same time, allowing for reaching farmers in a transparent manner. This will truly revolutionise the transformation of agriculture.”
Mastercard Farm Pass has touched approximately one million small-scale farmers in Kenya, Uganda, India and Tanzania since its inception in 2015, enabling them to command 25 to 50 per cent higher prices and boost harvest output. Farm Pass is a component of Mastercard’s strategy to connect underserved communities to essential services via Community Pass, a shared, interoperable digital platform that supports the company’s commitment to connecting one billion people and fifty million small and micro businesses to the digital economy by 2025.