Specialized Credit Providers

Mobile network providers have in the recent past been partnering with non bank institutions that directly offer solutions that incorporate credit, savings of insurance elements. The retail innovations make it easier for average income earners access loans to buy the products and services at affordable prices.

Specialized Credit Providers

Mobile network providers have in the recent past been partnering with non bank institutions that directly offer solutions that incorporate credit, savings of insurance elements. The retail innovations make it easier for average income earners access loans to buy the products and services at affordable prices.


M-Kopa Solar
The service provides rent-to-own solar energy products that will help provide cheap solar power to rural homes. The M-Kopa IV Solar Home System includes a solar panel, control unit, three low-energy LED light bulbs (one of which is a portable, rechargeable torch) and a rechargeable radio. The control unit also has a USB port for charging mobile phones. It's a perfect off-the-grid solar system for Africa, where land-based infrastructure is poor and electricity supply is frequently erratic


Musoni
Provides group loans, individual business loans, agri-business loans, emergency loans and education loans. In 2014 Musoni had more than 15,000 active borrowers.


Juhudi Kilimo
A provider of smallholder agricultural asset financing now offers a mobile phone-enabled livestock insurance product. Through this service, borrowers can obtain dairy insurance when purchasing a cow. Borrowers pay a premium of 3.5 per cent of the cost of the cow, and commit to following a Best Practice Care Calendar that includes vaccination, tick control, deworming, and mineral supplementation. If the cow dies within one year, a local veterinarian determines the cause of death and covered farmers are eligible for a payout equal to 50-80 per cent of the cow’s insured value. Borrowers repay their loans (including the insurance premium) using mobile money. Insurance payouts may also be received on the mobile wallet if it does not exceed maximum balance limits.


Kilimo Booster offered by Musoni is an agricultural loan for smallholder farmers. It utilizes M-Pesa for all loan disbursements and repayments. Loan values range from KES 5,000-350,000 (approx. USD 60-4,000), and loan terms are up to 12 months with up to a 6 month grace period. Monthly interest rates range from 1.5%-1.83%, a 3% upfront fee is charged, and there is a 20% cash collateral requirement, resulting in APRs ranging from 37.5-43.6 per cent.


Agrilife is a cloud-based technology platform designed to use mobile phone and web platforms to enable groups of smallholder farmers to access financial services, markets and other services that are relevant to them. Agrilife enables players in the agricultural sector – including banks, micro-finance institutions, insurance companies, cooperatives, investors, and agricultural input providers – to have access to data about farmers’ financial and physical supply chain. This enables farmers’ credentials to be established, minimizes risk and gives the farmer easier access to affordable credit. Farmers are able to to use the technology to make requests from their mobile phones/web platforms, and via Agrilife the requests are authorized and service providers are able to react other request. Agrilife allows farmers to capture information on their input purchases (seeds and fertilizer, for example), as well as their produce quantities and sales. Over a number of seasons this gives insight into their “production potential,” which can be used to access finance.


One Acre Fund provides loans for inputs and training for farmers. They operate in Kenya, Burundi and Rwanda. One Acre Fund began piloting mobile repayment with about 1,000 farmers in one district in mid-2013 (roughly 1.5 percent of Kenya clients at the time). In the initial trial, group leaders collected loan repayment from individual farmers, and then submitted an aggregate payment through M-PESA. This trial went well, and One Acre Fund decided to expand it in 2014.

The expanded trial included two configurations: group leader repayment (like the 2013 trial), and farmer repayment (new). The group leader repayment trial included 3,500 farmers (roughly 4 percent of Kenya clients), and the farmer repayment trial included 400 farmers (roughly 0.5 percent of Kenya clients). It’s too early to say exactly when One Acre Fund’s Kenya operation will be able to roll out mobile repayment to all its customers. With funding from the Gates Foundation, One Acre will test over 40 potential technologies over the next three years, with the goal of rolling out at least 4 technologies to at least 200,000 One Acre families.


Schutter Energy  is a social enterprise that installs Takamoto Pay-as-you-go (PAYG) Biogas systems in rural communities. Schutter Energy Ltd uses smart metering and mobile money. Smallholder farmer clients pay an installation fee and then only pay for the biogas they use. Their smart payment system allows farmers to purchase as little as $0.50 at a time in advance using mobile money. A proprietary smart meter allows gas to flow until these credits are used up, then stopping the flow. The smart meter communicates via mobile telephone networks, and sends information to Schutter’s database in real time so that we are always aware of the systems’ status and maintenance needs, allowing them to quickly solve issues that reduce the amount of biogas available to its clients.
Schutter Energy works with farmers that typically have 1-5 cows (which produce dung to feed the digester), access to fresh water, enough available space on their land to install a biogas system, and the capacity to use the biogas that the system produces on a daily basis. An additional benefit of the system is biofertilizer output from the digesters that has the ability to increase soil fertility and improve crop yield and quality. Schutter energy offers several biogas farm implements, such as a biogas brooder and biogas chaff cutter. In the future, we are planning on developing additional biogas implements such as a biogas irrigation pump.



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