Tuesday afternoon, we got down to details in six breakout sessions. ‘Participatory’ was the watchword, with all the speakers getting us thinking and talking about the ingredients for DFS to go rural.
- Working with agriculture/farmers with John Magnay of Opportunity International
- Linking with savings groups with Sybil Chidiac of CARE International
- Working with aggregators with David Darkwa of Vital Wave, an aggregator in Uganda
- Making bank/mobile network operator partnerships work with Jennifer McDonald of Women’s World Banking
- Lessons learned across Africa with Mike McCaffrey of The Helix Institute of Digital Finance - MicroSave
- Financial education for rural expansion and digital financial services with Jessica Massie of Reach Global, Aly Ouédraogo of Freedom from Hunger and Marie Pascaline of Réseau des Caisses Populaires du Burkina
It was hard to choose which sessions to attend, but here are some impressions from a couple of them…
Working with agriculture/farmers
Participants at this session really varied: there was a good number of people from banks/microfinance institutions and funders, but mobile network operators, governments and support organizations were also represented. 75% were already doing some form of agricultural finance. Together, it meant for a lively Q&A.
John started out by asking for participants’ concerns with their current rural finance strategies. Collection, capital, markets, value chains, costs of operation, dropouts, price risks, weather problems, land issues—we put it out there.
One participant from a mobile network operator noted, “I am in an economy that is highly influenced by agriculture. I see a cyclical nature in the use of mobile money based on agricultural season. With seasonal fluctuations, I start to worry… what is happening with my customers??!! But it turns out they are just cycling seasonally. We should plan around that and figure out how to respond to that cyclical demand.”
As Head of Agriculture at Opportunity International (and with nearly 40 years in African agricultural development to boot), John assured us that these are common challenges and would share how Opportunity International had dealt with them. And with that, we got into the nitty gritty—with both John and participants weighing in—to discuss how farmers are different from other clients, their specific financial needs, the best channels and models to reach them, and of course the challenges to reach them.
John summed up, “Agricultural finance is complex and certainly requires an understanding of the agricultural sector and value chains. But, there are very few businesses in which you can invest $1 and get $2–$3 back, which is entirely possible with farming.”
Linking with savings groups
This session started out with a number: 9.3 million. That’s the number of savings group members worldwide. Village savings and loans, a savings-group model developed by CARE International, reach 61 countries, count over 6 million participants and boast some of the highest repayment rates in the industry.
Sybil, a Senior Technical Advisor with CARE, also defined savings groups and how they function. With so many women and farmers already in savings groups—buying shares, setting interest rates, deciding loan terms—it’s easy to see how financial service providers are getting excited about the potential of linking with them as an efficient way to ‘go rural.’
Wasting no time, Sybil got us into small groups to talk specifics. One group brainstormed key features and functionality of a group account on a mobile wallet. The other talked terms and conditions of a group savings product. Finally, we discussed agents: who the potential agents are for these kinds of linkages and what incentives can be used with them.
It was a full day, for sure. Wednesday promises no less: we’ll be taking our discussions out of the meeting room and into the field. All 150 of us will be on field visits in the area of Kakiri. Stay tuned.