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Fintech and farming: how mobile money impacts sub-Saharan agriculture

  • By Timothy Roberts
  • Monday, December 23, 2019

On a continent where extreme poverty and food insecurity plague nearly half the population, innovations that support the agricultural industry are essential. 

Few such innovations have spread as quickly as mobile money. There are now nearly 146 million active accounts in sub-Saharan Africa, representing 10% of the region’s GDP (compared to less than 2% in most other parts of the world).  

But what does this have to do with agriculture? 

To answer that, consider these words from the United Nations, written in a 2019 update on the Sustainable Development Goals: “Strengthening the resilience and adaptive capacity of small-scale and family farmers…is critical to reversing the trend of the rise in hunger.” 

In other words, to save our planet’s growing population from famine, we need to give agricultural workers tools designed to help them recover from disaster and increase productivity. 

Mobile money is the most promising of those tools. Small-scale farmers in Africa need a secure place to save their money for emergencies, and they need the means to invest in better and more modern operations. Brick and mortar banks are failing them on both counts. In Tanzania, for example, where the agriculture sector employs 75% of the population, nearly half of all adults are excluded from traditional banks. Mobile money fills that gap. By making financial services accessible and convenient, initiatives like Tanzania’s Tigo (supported by Telepin) have helped to increase access to financial services by 11% since 2006. Other sub-Saharan countries report similar gains. For farmers, this could mean the difference between sustainable growth… or disaster. 

Here are three trends to watch as the story of mobile money—and the innovations driving it—continue to develop in rural sub-Saharan Africa. 


Smallholder farmers are using mobile money to develop greater resilience against climate-related emergencies. 


In a recent post discussing the role of mobile money in driving climate action, we explained how the very poor are disproportionately affected by climate change. They’re often excluded from the protections of the formal banking system, relying instead on a precarious cash economy. This limits their ability to recover after an emergency. After all, if all of your money is stored as cash in your home or is tied up in uninsured livestock or crops, a climate-related disaster could wipe it all away in a moment. And in sub-Saharan Africa, where 80% of arable land is managed by smallholder farmers and where climate extremes are triggering more frequent droughts, heat waves and crop failures, the threat of losing it all in a moment is especially urgent. 

Mobile money is the answer to that threat. By making services like credit, insurance, secure savings, and remittance payments available to those excluded from the traditional financial system, mobile money offers low-income farmers a degree of protection that they can’t find anywhere else. As our planet continues to warm and the climate convulses in response, such tech-based solutions will become increasingly essential. 


For women in the agricultural sector, mobile money could mean an opportunity for business growth.


Women make up 50% of the agricultural labor force in sub-Saharan Africa, yet many of them face barriers that make it difficult to modernize or scale their operations, leaving them in a precarious business position. 

A lack of access to formal banking infrastructure is perhaps the biggest of these barriers. Nearly 63% of women in sub-Saharan Africa lack any formal bank account, which means they’re cut off from the opportunity to securely save, borrow and invest in agricultural initiatives. Mobile money may be the agent of change for these women. 

Already, evidence that mobile money is shrinking Africa’s banking gender gap is emerging from some sub-Saharan countries; if that trend continues and more women gain access to low-cost and convenient microfinancing options, the result could mean more investment in female-led rural initiatives. Aside from bolstering Africa’s agricultural sector, such a development also suggests a more secure and independent future for women otherwise impacted by cultural and systemic inequality. 


Mobile money could keep more young people in agriculture. 


Africa’s agricultural workforce is draining away. A 2018 report from The U.N.’s Food and Agriculture Organization (FAO) reveals that half of the continent’s internal migration patterns flow from rural to urban areas; in sub-Saharan Africa, that figure rises to three-quarters of all internal movement. A dwindling rural population means limited agricultural production, further imperiling the country’s food supply. 

Only by incubating a new generation of rural entrepreneurs—young workers who have the skills and resources to modernize Africa’s agricultural sector—can the continent solve its food security problems and support a sub-Saharan population that’s expected to double in the next thirty years. The key to solving this problem, says the FAO’s Director-General, is to “ensure that new technologies reach and better serve often marginalized, rural people, including those living in fragile contexts.” 

Such technologies will facilitate lending and investing initiatives in the agricultural sector, capturing the potential of a new generation of smallholder and family farmers.