Millions of smallholder farmers in Sub-Saharan Africa now have access to Mastercard's Farm Pass, a digital platform that makes it safer and simpler for farmers to sell their goods at a fair price. This collaboration between Mastercard and Ecobank Group.
As part of the agreement, Ecobank will use its 33-nation Pan-African network to increase the impact and reach of the Mastercard Farm Pass platform.
Sub-Saharan African smallholder farmers deal with a number of difficulties. These include a lack of market access, a lack of operating cash to support operations or procure high-quality inputs, and an inability to effectively pay and receive payments.
This has caused instability, inefficiency, and food and resource waste, making it impossible for farmers to operate sustainable enterprises.
Farm Pass unites multiple supply and demand-side players in the agribusiness in a single agricultural marketplace, boosting their combined beneficial effects on farming communities. Smallholder farmers may obtain quality inputs and agricultural information, be paid and pay digitally, and build a financial profile that can open up financing options for working capital and inputs. They can also sell their goods for a higher price.
More than 60% of people in Sub-Saharan Africa are smallholder farmers, and the agricultural industry is expected to account for 23% of the continent's Gross Domestic Product, according to McKinsey & Company (GDP). However, barely 3% of the industry obtains banking financing, which limits farmers' ability to expand their businesses or reduce losses from subpar harvests.
Farm Pass gives smallholder farmers the ability to generate a digital transaction record that can permit formal loans or other financial services from banks and other financial institutions by linking their companies with payment systems.
"In current times, food security is a crucial and essential issue. Therefore, we must rise to the challenge by fostering growth prospects throughout Africa's agricultural value chain. The timing of our relationship with Mastercard is ideal to speed smallholder farmers' access to critically important financial services, which are essential to maximising Africa's agricultural potential. Additionally, it will assist offer value throughout the whole farming and agricultural value chain, enhancing the profitability, competitiveness, and resilience of African agriculture and promoting the continent's economic development, according to Ade.
"When we give people more power, we can fuel economies and foster inclusive economic growth. By providing a digital platform that makes it simpler for smallholder farmers to transition from subsistence to commercial farming, Mastercard Farm Pass makes a positive contribution to this. As a result, Africa's agriculture will develop, become more competitive, and have better food security. We can have a greater effect by putting the digital economy to work for everyone, everywhere, by working closely with significant partners like Ecobank, says Michael Froman, Vice Chairman and President, Strategic Growth at Mastercard.
"The Mastercard Farm Pass partnership with Ecobank Group fits nicely with the purpose of the recently approved Africa Emergency Food Output Facility (AEFPF) from the African Development Banks, which aims to enable nations to increase production and production for important essentials across the continent. According to Solomon Quaynor, vice president for private sector, infrastructure, and industrialization, African Development Bank Group, "one of the key activities of AEFPF is to connect farmers through e-wallet systems, i.e. digitising the procurement of agro inputs and at the same time allowing for reaching farmers in a transparent manner, which will truly revolutionise the transformation of agriculture."
Nearly one million smallholder farmers in Uganda, Tanzania, Kenya, and India have access to Mastercard Farm Pass since its inception in 2015, giving them the ability to demand 25–50% higher prices and boost harvest output.
Through Community Pass, a shared, interoperable digital platform that supports the company's mission to connecting, Mastercard is using Farm Pass as part of its plan to link underprivileged areas to crucial services.
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