By Simon Wandila and Bob Aston
Information and
Communication Technology (ICT) plays an important role in enhancing the impact
and performance of agricultural production and poverty alleviation by
increasing productivity through new credit and financial services.
Ensibuuko, a mobile and web
application that helps farmers in accessing financial services is making a huge
impact in Uganda as it has enabled saving and credit associations (and other financing
organisations) to handle savings and make loans to smallholder farmers.
Ensibuuko was
conceived over a cup of coffee between two friends in 2010. Mr. Gerald Otim and
Mr. Opio Obwangamoi David shared a similar background as they were both raised
in peasant farming communities.
Mr. Otim had
attempted to establish a microfinance organisation for farmers, but with a lot
of frustration. It is from these frustrations that he and Mr David were moved
to establish Ensibuuko.
The solution is
targeting farmer’s welfare through Savings and Credit Cooperative Organisations
(SACCOs). It allows farmers to register and apply for loans using SMS, save,
receive and repay loans using mobile money.
The result is
simpler, safer and flexible as it allows more control over one’s savings and
credit for farmers, lowers cost and gives greater transparency for savings and
credit groups.
Starting
Ensibuuko was not easy for the two friends as accessing capital to kick start
their innovation proved challenging. Their turning point came in August 2011,
when they met an agronomist at the Ministry of Agriculture-Buganda Kingdom who
helped them to kick start their innovation.
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In 2013, they
were named the overall winner of ICT4Ag Hackathon in Kigali, Rwanda. Fast forward to July
14, 2014 and the two are slated to be part of the Plug
and Play Day and as highly anticipated speakers during Fin4Ag Conference: revolutionising
finance for agri-value chains at the Kenya School of Monetary Studies in
Nairobi from 14 – 18 July 2014.
Ensibuuko has
leveraged mobile and web technologies to help smallholder farmers access
agriculture information and markets so as to attract young people into
farming. It has also been addressing lack of finance among
smallholder farmers as their productivity has been stifled due to a lack of
financial access. Currently it is estimated that smallholder farmers make up
more or less 80% of Uganda’s population.
Innovation
provides some real opportunities for transforming agriculture and putting
farmers in the driving seat. Mobile and web technologies are increasingly
becoming important for the adaptation of new opportunities in value chain
financing. Ensibuuko has managed to revolutionize this as it has managed to
expand the coverage of financial services to smallholder farmers in 35
sub-counties in Uganda.
Ensibuuko
recognises the fact that most smallholder farmers are unbanked and deemed
lacking of creditworthiness. The innovative system also generates a history of
how individual farmers have been saving with their SACCO. This helps the SACCO
to know how active the members have been while the farmer can also track his
transactions.
This
application also enables SACCOs to provide financial services to, hard to reach
areas, improve accountability and transparency in the handling of financial
transactions by SACCOs and makes it possible for Micro Finance Institutions
(MFI) to provide group loans. Through a partnership with Kiva, they have managed to raise
$20,000 to provide affordable mobile loans to farmers.
Other value
added services Ensibuuko provides include, market information and access to the
market for smallholder farmers. Because of the impact the company is making
through its service, they have been approached by various institutions such as
MFIs for possible partnership and replication of their service.
Currently,
Ensibuuko has 1,000 farmers who have registered in the system. Most farmers
appreciate the fact that it is convenient as it reduces travelling cost to
SACCO’s as all transactions can be done using mobile phones!
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