agriKOPA and agriPOS – Bridging Financial Gaps in Smallholder Agriculture​

- By Esther Ogbole
Over the years, bridging the financial gaps in smallholder agriculture has remained challenging in developing countries of the global south. Farmers in these parts of the world are mostly resource-poor, considered 'unbankable,' and need access to financial services. Access to financial services eases the adoption of improved technologies and investment in production, purchasing inputs, and transportation to formal markets. As such, an overview of the agricultural value chain from accessing inputs to output markets indicates that the sustainability of food systems, particularly in the global south, depends partly on access to finance. Digital platforms such as the agriKOPA and agriPOS have been developed by agriBORA to promote the financial inclusion of smallholder farmers in Kenya.

The agriKOPA

The agriKOPA is a service that helps unbanked farmers get loans. It uses a credit scoring system to match them with lenders who provide loans through the platform. The registered farmers attached to the agriHUBs are able to carry out smooth transactions with improved access to farm inputs for sustained food production. It also enables the blockage of financial leakages that may occur with physical transactions, helps farmers maintain traceable farm records, and consequently develops a credit score that enables access to financial institutions. The credit score functionality of the agriKOPA is important as farmers are often constrained from accessing insurance, credits, and loans due to the unavailability of farm/financial records.

While it is reported that over 80% of farmers in Kenya have access to mobile financial services, less than 15% of these services are traceable to agriculture. However, research findings reveal that using financial tools in agriculture reduces farmers' vulnerability to risks and has the potential for poverty alleviation. With this awareness, agriBORA supports smallholder farmers in Kenya in generating data through the agriKOPA, making them more visible and bankable to financial institutions. Having provided over 50,000 farmers with access to input data and available output markets through satellite imagery, the agriKOPA facilitates smooth value-chain transactions for farmers, thereby improving farm efficiency.

The agriBORA agriPOS

The agriPOS is a mobile application developed by agriBORA for Customer Relationship Management (CRM) among its agriHUB managers. The goal is to enable grassroots agro-based businesses to thrive while facilitating farmers' access to the agri-inputs and outputs markets they offer. Unlike the conventional Point of Sales (PoS) devices, the agriPOS is linked to farmers' funded agriKOPA through which payments can be made. The application helps agriHUB managers identify customers' purchasing patterns through bookkeeping, thus guiding decision-making processes. In addition to data from Earth Observation (EO) and blockchain, the agriPoS, similar to the agriWallet, proves the creditworthiness of agriHUB managers and enables access to credit and loan facilities.

Conclusion

Digital financial platforms such as the agriKOPA and agriPOS are a means to an end. Both platforms reposition agricultural value-chain actors by mainly creating and storing farm data that facilitate access to opportunities that improve production and marketing efficiency. They also facilitate increased yields and increased agribusiness growth potentials. These benefits, in turn, enable actors to consistently contribute to food production, thus addressing problems relating to food and nutrition insecurity.