digital power, farmers, productivity, formal value chains, value chains

The digital power is giving farmers increased productivity and access to formal value chains

The world is ever-changing and, so is the sector your business operates. Many people [farmers] are leveraging digital power to gather the needed data to keep track of trends that are shaping the economy.

People [farmers] need the expertise to turn that data into valuable insights and sustainable growth opportunities that will unlock your business’ potential.

In the Absa Insights podcast series, The Money Show’s Bruce Whitfield engages in conversation with the bank’s sector experts about investment possibilities in Agriculture, Consumer Goods and Services, Enterprise Supply Development and Telecommunications, Public Sector, and, Natural Resources and Energy.

Listen to the audio below:

Telecommunication companies are making a huge impact on agriculture and healthcare in Africa.

One of those companies is Mezzanine – which started its journey in the healthcare industry back in 2004 focusing on medical and healthcare opportunities until it was acquired by Vodacom in 2012 as a subsidiary of the Group with a mandate to support markets with the design and development of digital solutions customers in the agricultural and healthcare spaces across Africa.

Envisioning the era of IoT

By leveraging the basic services of feature phones such as SMS, USSD, and voice services, the company has evolved into a digital technology market leader that co-creates digital solutions that enable productive societies.

“As engineers, we always dream of the impossible. So, we have these cases in mind but what was overwhelming in a positive way was the reach of making these benefits available to resource-limited settings.

“So naturally, you would think that these very rich digital experiences will be available to the upper end of the market, but the benefit of mobile is really taking these services to the African continent,” said Jacques de Vos, Chief Executive Officer of Mezzanine.

Read also: Dying mangoes: Bacterial black spot disease destroying mango plantations

Free, perfect, and instant delivery of services

For de Vos, the opportunity in leveraging the digital attributes of delivering free, perfect, and instant services to citizens on the content is exponential.

So, how do we leverage these digital attributes to create new value or business models and use these attributes to effectively deliver value and capture value to support governments and private enterprises?

“The question we’ve asked is, how do we use mobile in combination with digital in bringing that benefits to the last mile. The definition of the last mile in Africa – it’s in the classroom, it’s on the farm, it’s in the clinic, it’s at the workplace,” added Jacques de Vos.

Mobile has really brought these digital attributes to the broader subscriber base across the continent, says de Vos.

“So, how is this technology helping somebody sitting in rural Tanzania who can’t get to town for medical care,” asks The Money Show’s Bruce Whitfield.

digital power, farmers, productivity, formal value chains, value chains
Digital power application on the tea farm in Africa

In the case of healthcare, Mezzanine has seen digital, and mobile improves the access to health services, the quality of health services, and the affordability of accessing those services.

“A lot of these citizens or beneficiaries that reside within a resource-limited setting – let’s say a rural area in Tanzania is confined to a hyper-local marketplace. So, their need to interact and transact is really confined to whatever services are on offer within the immediate proximity,” says Jacques de Vos.

The focus on health system strengthening preventions and solutions using mobile ensures that there is access to medical services where it is needed and when it is needed, a safe supply of medication and the quality of these services rendered by either public or private providers meet the requirement.

From medical care to connecting rural farmers to the outside world

Over the years, the subsidiary has worked on various ways to use mobile and digital to allow farmers to participate in formal value chains so that they are able to access financial services.

“We kind of think of agriculture as a large-scale commercial operation but the vast majority of farmers across the African continent are small-scale… getting them connected to the outside world is absolutely pivotal in terms of the survival of entire communities in remote areas,” says The Money Show’s Bruce Whitfield.

Read also: Land Policy: Digital technology key to land management in Africa

In the past, financial service providers deemed it too risky to service farmers with credit products or insurance products.

“On the sub-Saharan African market, there are about 77 million of these benefactor small-scale farmer families and the majority (which is) more than 90% of these small-scale families are not participating in what we refer to as the formal agriculture value chain,” Jacques added.

Today, we see financial service providers making products available to this sector of the market because mobile and digital is able to manage and mitigate the associated risks of servicing the segment, says de Vos.

Giving the farmer the digital power

Thanks to the Internet of Things, farmers participating in formal value chains are given the power to choose which stakeholders to transact and interact with, and, while it has resulted in an increase in productivity, it has also increased the income generated by farming families.

“The part that we’re excited about is the fact that we can make these benefits available to literally millions of farmers,” Jacques de Vos.

At present, the digital technology company supports close to 3 million farmers with a number of these digital services.

“In the past, the digital tradition insurance products to farmers required an assessor to visit the farm to perform physical assessments of what the damage was after a hailstorm or drought – from an affordability point of view, this meant that small-scale farmers were not able to afford these insurance products,” says de Vos.

Read also: Agriculture in the era of climate change: Sustainable practices don’t have to come at the cost of productivity

By using satellite imagery and earth observation capabilities to monitor soil moisture and rainfall within regions across African countries, agricultural insurers have introduced index insurance to farmers subscribed to the insurance product.

And, in the case of drought or floods, farmers can now receive a pay-out without any physical assessments taking place.

“So, we’ve used technology and we’ve used the reach of mobile, to in effect, enable the insurers to serve what was an under-served segment of the market,” Jacques de Vos, Chief Executive Officer of Mezzanine.
digital power, farmers, productivity, formal value chains, value chains

New opportunities for agricultural insurers

The power of digital has linked agricultural insurers to 77 million new customers, which makes for an attractive investment opportunity to any multinational looking to expand into new regions and segments.

“The question we should ask each and every industry is, how do we leverage these attributes to start servicing these segments of the market which we’ve ignored completely,” said Jacques de Vos, CEO of Mezzanine.

Read also: Wedding guests lose focus as plus-size lady with soft body whines waist [Watch]

Why don’t we see a mass uptake of these digital services?

While the Vodacom Group is a trusted brand on the continent, de Vos believes that it is important to bring the benefit of digital combined with a trusted brand and a local representative with an appreciation for the local culture to present the service in the village before an uptake can be seen.

Jacques de Vos stated “Intervention required on a government regularity level to create a more conduce business environment is a priority, and we invest a lot in working with the African Union and working with the European Union in supporting governments in introducing a more digital-friendly e-commerce regulatory environment.”

We need to free up and liberate our entrepreneurs to continue to develop new solutions and innovate and then we will see thousands of new spaces being delivered in these markets, concludes de Vos.

The Choice Press
thechoicepress.com is an online news portal that seeks to project what the gallant small-scale farmers in Africa are doing. We basically report on everything that has to do with agriculture and agribusiness, especially in Ghana.
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