An initiative by the Better Than Cash Alliance has demonstrated how agriculture non-profit organization, One Acre Fund, managed to digitize loan repayments for farmers in Kenya and in the significantly boosting transparency and efficiency. The initiative also assisted with the financial inclusion of thousands of smallholder farmers in Kenya who otherwise handled most transactions, including loan repayments, via cash.

The initiative, which is documented in a case study, was in partnership with Citi Inclusive Finance.

![How Digitizing Agricultural Input Payments in Rural Kenya Is Tackling Poverty: The Case of One Acre Fund](/content/images/2017/06/Case-Study---How-Digitizing-Agricultural.JPG)
Download the "How Digitizing Agricultural Input Payments in Rural Kenya Is Tackling Poverty: The Case of One Acre Fund" case study

β€œMobile repayments have allowed us to increase our efficiency and provide better service to farmers," ” said Mike Warmington, Director of Microfinance Partnerships at One Acre Fund.

What is interesting as observed in the case study is that the average farmer in Kenya who participated in the program earned nearly 50% more than peer farmers who did not participate. This is attributed to among others, how digital payments (as opposed to cash) helped farmers manage their finances better.

β€œWe’re excited to be working at the forefront of this technology in the smallholder agriculture lending sector. In our experience, farmers were empowered to thrive in these communities. Clients receive immediate confirmation of payments as they happen, enabling them to better manage their businesses and family finances.” added Warmington.

Some of the observations from the study are:

  • Increased participant satisfaction due to transparency and convenience.
  • Eighty-five percent decreased instances of repayment fraud.
  • Reduced processing time for each repayment from 12-16 days to 2-4 days; farmers now know immediately when their payment is received, eliminating the worry about whether it arrived.
  • Eighty percent decrease in repayment processing costs.
  • Forty-six percent of time reduced for staff working on collections, allowing for more time helping farmers improve agricultural practices.
  • Women farmers benefited especially, feeling safer about payment deliveries.

![Farmers Kenya Mobile Payments](/content/images/2017/06/Before-and-After-the-Mobile-Payments-Shift.JPG)

β€œDigital payments are essential to building sustainable business models and creating long-term impact. By enabling smallholder farmers to make and receive payments digitally, we are creating transparency and accountability which translates to numerous benefits and empowers people to take control of their finances,” concluded Oswell Kahonde, Africa Regional Lead at the Better Than Cash Alliance.

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