Building the next generation of farmers Supporting capacity-development of African Farmer’s Organisations through improved Policies, Technologies and Capabilities Workshop , 6-7 November 2018, Brussels

1. Norbert Tuyishime
EAFF
“Data driven decision making”
NOV 2018

2. Content
1. EAFF
2. EAFF membership & strategic plan 2013-2020
3. What affects our agriculture
4. A profile of SHF
5. eGranary – updates/ delivery models
6. KPIs
7. Key lessons
8. Partners

3. EAFF membership• ...
EAFF Vision
A Prosperous and Cohesive Farming
Community in Eastern Africa
Currently (> 20 million farmers)
10 countries; 24 apex organizations
Our scope is the Eastern Africa –
Membership scope in EAC; COMESA
& IGAD….
-Producer co-operatives;
- Commodity Associations;
-Women organizations;
-Lobby & advocacy based ;
• Launched in 2001 - operations from
2005
• Purpose – Regional Integration process
• Members are producers of crops;
livestock; fisheries & Agroforestry

4. EAFF 2nd Strategic Plan (2013-2020)

5. What is affecting our Agriculture /Approach to solution?
2. Lack of Data on Farming (for decision
making on – attracting investments & innovations in
technology, financing; value addition; advisory services
& policy)
Solves 4-6
Farmers have “LOST POWER” in the Market
No silver bullet
1. Low Collective action by farmers-; joint output marketing; ease of
access/provision of services; joint input procurement; efficient technology use/up-
take; phl mgt; poor partnerships; value addition prospects
solves 1-4

6. Mobile
Phone
• Over 90% mobile
penetration
• 15% Smartphone
penetration
MPESA
• Mobile payment
penetration is 86%
of households
• 31m mobile money
Subs
Farmer
• 70% of adult
population in Kenya
works in
Agricultural sector
FO/
COOP/
Self-help
Grp
• 3 out of every five
Kenyan farmer is a
member of a
Cooperative/Farmer
Org./Self Help Group
etc.
Mary
A TYPICAL KENYAN FARMER PROFILE: CURRENT STATS
Has...
Uses...
Is a...
Is a member
of...

7. Warehousing
Value
addition
CreditE-extension
Agric
inputs
AGRIBUSINESS strategy
POLICY strategy: lobbied for an EAC (regional) co-op law (it awaits assention)

8. e-GRANARY is a mobile based platform that provide 4 in 1 services – aggregates
farmers for input, output and services markets (financial, insurance, extension and
mechanization).
e-GRANARY value proposition is an ecosystem that will benefit ALL the stakeholders
that engage on the platform and its various connected services.
For Farmers, it will allow the sale of farm produce at the best price, access to
certified inputs and affordable tailor made financial solutions.
For Financial Institutions, it will allow access to bankable and de-risked smallholders
to market various financial products. In fact, the loan will be income based while
leveraging the group structure in farmer organizations to reduce risk. Insurance is
provided as a bundled product with the loan
For buyers, it allows access to better quality traceable produce in a large
marketplace at competitive price without the exorbitant premium charged by
middle man currently.
eGranary - BUSINESS MODEL VALUE PROPOSITION FOR
STAKEHOLDERS

9. BUSINESS MODEL - CORE SERVICES PROVIDED TO FARMERS
Crop Management
Knowledge and Tools
Organizing
Learning Groups
Policy and
advocacy
Group Purchase of
Agriculture Inputs
Coordination of
Contract Farming
with Millers / Buyers
Coordination of Post-
harvest Services
Coordination of Farm
Equipment Leasing
Micro-finance
and
Micro-insurance

10. OPERATIONS -e.g. CREDIT AND INSURANCE
Rural Banks
Micro-finance
Institutions (MFIs)
Micro-insurance
Company
Mobile Banking
Accredited Service Providers
Agri-inputs:
Seeds
Fertilizers
Farm
equipment
leasing
Post-harvest
services:
Threshing
Drying,
Storage.
Farmers payback micro-
loans after sales of
produce
Payment for products and services
through micro-finance bundled with
micro-insurance
Access to credit helps farmers gain access to agri-inputs, farm equipment and post-harvest
services

11. 2016 2017 2018 PLANNED 2019
Farmer
recruitments
Farmer recruitment onto eGRANARY
platform
5,000 39,000 103,000 340,000
Extension
services
Farmers reached with extention messages - 1,000 20,000 150,000
Value chain Value chain focus Maize Maize, soyabean Maize
Maize, Soyabean, beans,
pulses, rice
Farmers qualified for input loan 1,200 2,137 290 2,800
Loan issued/planned (Kes) Insurance inlusive 4,729,500.00 6,916,000.00 4,023,890.00 100,000,000.00
Loan issued/planned (US$) Insurance inlusive 46,367.65 67,803.92 40,238.90 1,000,000.00
Loan amount per farmer 38.64 31.73 138.75 357.14
Notes
There was a nationwide
drought which was
declared a national
disaster in Kenya, farmers
lost over 90% of the crop
to drought. Insurance
claim was paid and the
cost of input loan was
covered
Loan Repayment rate was
at 70%. Company needed
to reavaluate the process
of eligibilty to reduce risk
since 30% bad book is
unsustainable
Loan amount per farmer
increased due to an enhanced
input package per farmer.
Better Group profiling has
reduced the pilot group for the
short season which is not the
main season. Scale up next
seasion. Numbers low due to
this pilot falling on the short
rain season.
The production is planned for
the main season
Source of portfolio funds Internal Internal
Partner financial institution
(Vision fund )
Partner financial institution
(Vision fund, ECLOF, KCB,
Stanbic, Urwego
Opportunity bank
Peoples Bank, Centenary
Bank)
Market access partners ETG ETG ETG
ETG, Yash Commodities,
Soyafric, Mini Mex,EAX,NAS
millers, WFP
Input loan
Partnerships
SOME KEY PERFORMANCE INDICATORS TO DATE

13. KEY LESSONS

14. LOAN PRODUCTS FOR FARMERS
 Most small holder farmers are in dire need of support to access certified inputs. Where
financing is not easily available farmers recycle seeds, use less fertilizer and rarely uses
necessary chemicals.
 Loaning to small holders farmers is most effective when the product offered is a non-cash loan
providing the following key input components:
 Seeds
 Fertilizers
 Weed killers and pesticides
 Crop insurance premiums
 Loan should have Flexible repayment terms that are linked to actual crop cycles to maximize
repayments which encourages financial companies to continue supporting the sector.
 From experience farmers have less defaults where they are;
1. Encouraged to bring a deposit of at least 10% when collecting inputs .
2. Farmers are encouraged proactively repay their loan through the loan terms and nor
necessarily wait for end of season to make sales

15. LESSONS LEARNT ON SUPPLY CONTRACTING
• A key responsibility for a seller is to make delivery against the contract and a key right is to
receive payment for grain delivered against the contract when due and payable as defined in the
contract.
• A key right for a buyer is to receive grain against a contract and a key responsibility is to make
payment for grain delivered against the contract when due and payable as defined in the contract.
Key component of the contract
Price
Price terms
Delivery date or period
Details of grain quality (grade) required
tonnage and tolerances
Fees and or charges applicable
Payment terms
Default procedures
Dispute resolution procedures

16. IN SUMMARY
 Market and certified input access is a major concern for farmers across all the regions we are
operating and farmers are eager to be part of program offering a solution in these two areas.
 Climate change is a major concern for farmers making them open to innovate financial solutions like
insurance
 Over 95% of small holders have access to a mobile phone however smart phone access is still under
15%.
 Technology illiteracy is a problem and a lot of capacity building is required.
 Farmers prefer to form and work in small community based groups which involve themselves in other
common activities like saving, table banking, poultry farming, merry-go-rounds etc.
 Farmers need financial solutions especially for
inputs credit. Fertilizer being the most
expensive input they have to buy
 Farmers are willing and able to payback loans if
appropriately priced and structured
12
Credit
 There is increased demand for insurance
by farmers
 SHF consider insurance very expensive
and don’t trust providers – Awareness
and trust building is required
 Insurance is better received when
bundled with input loans
Insurance
Overall

17. PARTNERS

18. CONTACTS: info@eaffu.org;
www.eaffu.org
FARMERS CONFERENCE CENTRE
Dagoretti- Gikambura –Thogoto road
KIKUYU TOWN
KENYA
Tel: +254 20 445 1691