Publication

Digitizing the Dairy Value Chain in Nepal

Summary

Cooperatives play a significant role in the financial sector of Nepal. Not only do they offer financial services to people who reside away from banking facilities but also act as the credit and savings unit for local level business such as dairy farming. As per the Finscope Study, there are more than 1,700 dairy cooperatives with a member base starting from 200 to 2000 farmers.

As part of the organization mission to expand digital financial services in rural areas, Prabhu Management is currently exploring options to enable a smooth payment flow architecture to support the dairy cooperatives. With technical support from UN Capital Development Fund programme MM4P, Prabhu Management aims to leverage its current network of 3,500 Prabhu Money Transfer agents (remittance company) to streamline payment flow challenges that affect the income and profitability of about 1.6 million dairy farmers.

Upon numerous internal researches, we narrowed down the core payment challenges faced by farmers and cooperatives such as:

  • - Safety and cost of cash movement for dairy cooperatives
  • - Delayed payments for farmers

The factsheet on “Digitizing the Dairy Value Chain in Nepal”, walks us through the payment related challenges faced by an average dairy farmer and cooperative in Nepal along with an ecosystem approach paired with digital technology as a proposed solution.