July 18, 2024

Mastercard, EcoBank Group alliance to digitize agricultural value chains in Africa

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Harry Aithnard, Regional Executive Director of UEMOA, Ecobank (left), Solomon Quaynor, Vice President for Private Sector, Infrastructure and Industrialization, African Development Bank Group (centre) and Michael Froman, Vice Chairman and President, Strategic Growth for Mastercard (right), at the signing ceremony of Mastercard’s Farm Pass partnership agreement with Ecobank Group held on the sidelines of the Africa CEO Forum in Abidjan, Cote d’Ivoire.

Mastercard and Ecobank Group have partnered to connect millions of smallholder farmers in Sub-Saharan Africa to Mastercard’s Farm Pass – a digital platform that makes it safer and easier for farmers to sell their produce at a fair price.

Under this partnership, Ecobank will extend the reach and impact of the Mastercard Farm Pass platform leveraging its Pan-African network of 33 nations. Many smallholder farmers in Sub-Saharan Africa face several challenges.

These comprise limited access to markets, working capital to finance activities or secure quality inputs, and relevant financial tools to pay and get paid efficiently. This has led to insecurity, inefficiencies, and a waste of resources and food, preventing farmers from running sustainable businesses.

McKinsey and Company report added that more than 60% of the population of Sub-Saharan Africa are smallholder farmers, with the agricultural sector contributing an estimated 23% of the continent’s GDP. Yet only 3% of the sector receives banking credit, limiting the farmers’ capacity to grow their business or mitigate poor harvest losses.

By integrating their businesses with payment systems, Farm Pass enables smallholder farmers to build a digital transaction record that can facilitate formal credit or other financial services from banks and other financial institutions.

Mastercard added that the Farm Pass brings together various agri-sector stakeholders from the supply and demand sides, in one agricultural marketplace, amplifying the collective positive impact on farming communities. Smallholder farmers can sell their produce at a better price, access quality inputs and farming information, get paid and pay digitally and develop a financial profile that can unlock financing opportunities for working capital and inputs.

Ade Ayeyemi, CEO of Ecobank Group

Ade Ayeyemi, CEO of Ecobank Group stated: “Food security is a critical and urgent need in these times. We must therefore rise to the task by creating growth opportunities across the agriculture value chain in Africa. Our partnership with Mastercard has come at the right time to accelerate smallholder farmers’ access to urgently needed financial services, which are vital to realizing Africa’s full agricultural potential. It will also help deliver value across the farming and agricultural value chain to make farming in Africa more profitable, competitive, and resilient, thus contributing to the economic growth of the continent.”

Michael Froman, Vice Chairman and President, Strategic Growth at Mastercard

Michael Froman, Vice Chairman and President, Strategic Growth at Mastercard stated: “When we empower people, we can power economies and support economic growth that is truly inclusive. Mastercard Farm Pass contributes to this by offering a digital platform that makes it easier for smallholder farmers to move from subsistence to commercial farming. This, in turn, will stimulate agricultural growth, increase competitiveness, and improve food security in Africa. Through close collaborations with important partners like Ecobank, we can create even more impact, putting the digital economy to work for everyone, everywhere.”

Solomon Quaynor, Vice President for Private Sector, Infrastructure, and Industrialization, African Development Bank Group: – Image Source

Solomon Quaynor, Vice President for Private Sector, Infrastructure, and Industrialization, African Development Bank Group stated: “The Mastercard Farm Pass collaboration with Ecobank Group fits well with the intent of the African Development Banks’s recently approved Africa Emergency Food Production Facility (AEFPF), which is to support countries to boost production and productivity on the continent for key staples. One of the key activities of AEFPF is to connect farmers through e-wallet systems, i.e. digitizing the procurement of agro-inputs and at the same time allowing for reaching farmers in a transparent manner, which will truly revolutionize the transformation of agriculture.”

Mastercard further explained that since its inception in 2015, Mastercard Farm Pass has reached nearly one million smallholder farmers in Uganda, Tanzania, Kenya, and India, empowering them to command 25%-50% higher prices and surge in the harvesting productivity.

Industry sources added that Farm Pass is a part of Mastercard’s strategy to connect underserved communities to essential services through Community Pass, a shared interoperable digital platform that supports the company’s commitment to connecting one billion people and 50 million small and micro businesses to the digital economy by 2025. 

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