A Transparent, Easy Way for Smallholder Farmers to Save | Anushka Ratnayake | TED

Summary

This video highlights the challenges faced by smallholder farmers in West Africa, who often lack access to safe savings mechanisms. The nonprofit myAgro helps farmers save small amounts over time using mobile technology, allowing them to invest in seeds and fertilizer to improve their yields and income. The savings-led model empowers farmers, particularly women, to break the cycle of poverty and hunger. With an audacious vision to reach one million farmers in five years, myAgro aims to transform agriculture and reduce poverty in the region.

Takeaways

• 🌍 In West Africa, where the speaker lives, there are 60 million smallholder farmers.
• 📉 Smallholder farmers are the largest group living on less than two dollars a day and many go hungry each year due to insufficient crop yields.
• 🚜 Government subsidies often favor large farms and male farmers, leaving many smallholder farmers, especially women, without adequate support.
• 📉 Despite significant investments, crop yields per hectare have not increased significantly in over four decades.
• 💸 The fundamental problem is not that farmers have no cash, but that they don't have it when they need it.
• 🏦 Many farmers lack a safe place to save money, making it difficult for them to invest in their farms.
• 🌱 MyAgro helps farmers save little by little for improved seeds and fertilizer, using a familiar scratch card system.
• 👩‍🌾 The program is especially beneficial for women, who value the democratic access to resources and the manageable savings cadence.
• 📈 In 2021, the average myAgro farmer grew twice as much food and earned $200 more in net income than non-myAgro farmers.
• 🚀 MyAgro's goal is to reach one million farmers in the next five years, using farmers' own savings to reduce poverty and hunger in West Africa.

Q & A

What is the main economic challenge faced by smallholder farmers in West Africa?

The main economic challenge faced by smallholder farmers in West Africa is that they lack cash at critical times, such as planting season, despite having some cash at other times, such as during harvest. This cash flow issue prevents them from making necessary investments in their farms.

Why do traditional government subsidies and grants often fail to benefit smallholder farmers, especially women?

Traditional government subsidies and grants often fail to benefit smallholder farmers because they are usually directed towards large farms and male farmers, even though women are the backbone of farming in Africa. Additionally, these subsidies don't meet the full demand, and yields per hectare have not significantly increased despite these investments.

What surprising insight did the speaker discover while working in microcredit in 2008?

The speaker discovered that the fundamental problem was not that farmers lacked cash entirely, but that they didn't have it when they needed it. Farmers expressed a desire to save money for future needs, even though they used the language of credit.

How does the myAgro program help farmers save money for agricultural investments?

The myAgro program helps farmers save money by allowing them to make small, incremental payments using scratch cards or mobile money over the course of nine months. These payments are saved up for the purchase of improved seeds and fertilizer, making it easier for farmers to afford what they need for a more productive harvest.

What impact has the myAgro program had on farmers' yields and incomes?

The myAgro program has significantly improved farmers' yields and incomes. In 2021, the average myAgro farmer grew twice as much food as non-myAgro farmers in the same area, resulting in an additional $200 of net income, which is a 35% increase for a farmer living on $1.50 per day.

Why is the myAgro savings model particularly beneficial for women farmers?

The myAgro savings model is particularly beneficial for women farmers because it offers democratic access to seeds and fertilizer, and the savings process matches the small amounts of money they earn weekly at local markets. This model has led to 60% of myAgro farmers being women, despite only 20% of women in the region owning a bank account.

How does the myAgro platform ensure transparency and trust in the savings process?

The myAgro platform ensures transparency and trust by using a familiar and simple method of payment—scratch cards—that farmers understand and trust. Each payment is validated and tracked digitally, providing a transparent and stress-free savings experience compared to traditional methods where cash is handed over without any receipt.

What are the broader benefits of the savings-led model used by myAgro for both farmers and the organization?

For farmers, the savings-led model is reliable, low-stress, and empowers them to break the cycle of poverty by making their own investments. For the organization, it reduces the need to raise large amounts of working capital each year by unlocking capital from the farmers directly, making the model sustainable.

Can you describe the transformation that occurred in Setou’s life after joining the myAgro program?

After joining the myAgro program in 2014, Setou gradually reinvested her increased profits into her farm, ultimately transforming her life. She now owns ten cows, which she rents out for additional income, and has moved her family from a one-bedroom home to a larger house. Her smart investments in farming have significantly improved her family's quality of life.

What is the long-term vision of myAgro, and how do they plan to achieve it?

The long-term vision of myAgro is to reach one million farmers within the next five years by scaling their savings-led model across Mali, Senegal, and Tanzania. They plan to achieve this by investing in data and technology, enabling more smallholder farmers to break the cycle of poverty and hunger through their own savings and investments.