A cross Africa, smallholder farmers struggle to get a fair price for their crops because they usually have to go through middlemen or agents.
The process is often opaque because the smallholder farmers--who represent 90% of agricultural output in the continent --are unable to verify the price at which the middleman sells the produce to food processing companies or the market. In response to this problem, financial services company Mastercard launched a pilot programme called 2KUZE, which is a platform linking smallholder farmers directly to markets and buyers, therefore bypassing middlemen.
The 2KUZE app, which has been tested on 2,000 farms in Kenya and will also be rolled out in Tanzania and Uganda, can be used on a smartphone, tablet and even a GSM mobile phone. The app is an example of the company leveraging technology to boost financial inclusion across the continent, according to Raghav Prasad, president of Mastercard's sub-Saharan African division, who spoke to African Business at the company's 2018 Connecting Tomorrow Forum in Barcelona in September.
"Africa is in a wonderful position to take advantage of the latest technology to leapfrog, and it is also a great opportunity for us because of the room to scale," Prasad says. "Because of some of the challenges facing many African countries such as limited infrastructure, you can't scale payments in Africa using the same old playbook of having terminals, which could cost hundreds of dollars each to set up, and plastic cards that cost three dollars apiece.
"In Africa, we have gone full-in on technology which allows us to scale in the most cost-effective way possible. However, one of the biggest challenges we face in Africa is that the opportunity is so vast, you need to work out how to operationalise at a reasonable cost to serve."
The event also showcased the multinational company's other technologies that aim to bridge the gap between banked and unbanked people, especially in Africa where only around 30% of people have bank accounts. Mastercard currently operates in 32 markets in sub-Saharan Africa, with the most recent additions being Chad, Central African Republic, Guinea-Bissau, Liberia, Sierra Leone, Rwanda and The Gambia. The company has formed partnerships with fintech companies including M-Pesa and Tigo Pesa. One of its most successful products in Africa is Masterpass Quick Response (QR) which was initially launched in Pakistan, but has successfully been implemented across the...