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The potential of mobile phones in transforming agriculture for smallholder farmers: Results from the Agri-Fin Mobile product development and baseline surveys

The potential of mobile phones in transforming agriculture for smallholder farmers: Results from the Agri-Fin Mobile product development and baseline surveys

The following is a guest post by Richard Nyamanhindi, the Agri-Fin Mobile Program Coordinator at Mercy Corps.

In late 2012, Mercy Corps’ Agri-Fin Mobile Program commissioned consultants to carry out baseline surveys in order to analyse the potential of ‘bundling’ information services and financial products that can be delivered via mobile phones to assist smallholder farmers increase their incomes in Indonesia, Uganda and Zimbabwe.

The findings from the surveys are intended to support mobile network operators, farmer organisations, financial institutions and others that play active roles in agriculture and mobile money ecosystems to develop sustainable business models.

Overall, the survey findings indicate significant potential for mobile related services in the three countries. For example, more than 80 percent of all surveyed households in Indonesia and Zimbabwe have access to a mobile phone – the only requirement for using mobile phone services. The number was slightly lower in Uganda (65 percent) due to low education levels among farmers and limited network coverage in most rural areas.

Limited uptake of mobile money, as well as limited use of services beyond remittances, appears to be related to an incomplete understanding of the products available.

In relation to the provision of information services to farmers, the research noted that the traditional sources of information – face-to-face and radio are still important sources of contact for most farmers in the three countries. Although there are farmers currently receiving agricultural information through their mobile phones the percentage is a paltry two percent in both Zimbabwe and Uganda. Interviewed farmers however, expressed interest in receiving information through mobile phones.

Regardless of the m-money status of a household, the research noted that remittances are primarily used for routine financial support among relatives living in different households. Evidence from those using mobile money revealed a steady, but gradual, increase in the mobile money subscriber base with 46 percent in Indonesia, 55 percent in Uganda and 64 percent in Zimbabwe of remittances being sent/received mobile money. However, the uptake of services beyond money transfers is somewhat slow, and an average 30 percent of registered users reported knowing about other mobile money applications other than money transfers, sms, and voice services.

The research also noted that rural users travel longer distances (average of 45 kilometers) and spend more money on transportation to reach mobile money agents. Once they get to an agent location farmers in Zimbabwe (where there is liquidity crunch) for example noted that they are more likely to face problems related to agents’ absenteeism, agents experiencing a shortage of cash.

Subsequently Agri-Fin mobile researches will continue to monitor mobile services growth and measure how effectively barriers to new or greater adoption have been overcome.

For more detailed research results please visit: http://bit.ly/agri-finmobile

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