Michael Hamp, IFAD
27 October 2010
Overview of IFAD-funded ICT
related activities supporting rural
enterprises
2010 Inform...
Outline
• Mobile-phone banking pilots
• IFAD-WFP Weather Risk Management Facility
• Rural remittances
• Agricultural value...
Why is branchless and mobile banking
relevant?
• Branchless banking:
- reaches large numbers of poor rural people
- uses I...
Branchless banking: A beacon of hope
Encouraging results:
• branchless banks reach remote areas. In rural Brazil, deposits...
IFAD-WFP Weather Risk Management Facility
• a joint initiative of IFAD and WFP with support from Bill
and Melinda Gates Fo...
WRMF focus
The WRMF focuses on four areas:
• Building the capacity of local stakeholders in
weather risk management.
• Imp...
WRMF main outputs
• pilots in Ethiopia and China
• Technical publication on: ‘Potential for Scale and
Sustainability in We...
Rural remittances
Did you know that:
• 30 to 40% of remittances goes to rural areas
• Thanks to high mobile penetration ra...
Remittances and mobile banking
Konecta in Paraguay:
launching a new technological platform service for fast money
transfer...
Pro-poor value chain programmes
Smallholders in Value
Chains:
•
Usually disadvantaged because
they lack information, which...
Pro-poor value chain programmes:
Access to information
Zambia National Farmers Union
(ZNFU 4455): Business model
 Service...
Where to next?
• How do we move from piloting and more piloting to mainstreaming
ICT4D in development activities?
• What i...
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Enabling role of ICTs to transform smallholder farmers to entrepreneurs

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"Enabling role of ICTs to transform smallholder farmers to entrepreneurs”. An overview of IFAD-funded ICT related activities supporting rural enterprises. Presentation at FAO Rome, 27 October 2010 by Michael Hamp, Senior Rural Finance Advisor and Head of the Financial Assets, Markets and Enterprise Development Unit of the Programme Management Department, IFAD.

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Enabling role of ICTs to transform smallholder farmers to entrepreneurs

  1. 1. Michael Hamp, IFAD 27 October 2010 Overview of IFAD-funded ICT related activities supporting rural enterprises 2010 Information Economy Report presentation at FAO
  2. 2. Outline • Mobile-phone banking pilots • IFAD-WFP Weather Risk Management Facility • Rural remittances • Agricultural value chains and marketing
  3. 3. Why is branchless and mobile banking relevant? • Branchless banking: - reaches large numbers of poor rural people - uses ICT and non-bank retail agents to deliver financial services outside conventional • Some example: - Kenya: 50% of population is registered for M-PESA (only 23% has bank accounts) - Remote rural community in the Amazon: 5 BB agents have made a night-day difference!
  4. 4. Branchless banking: A beacon of hope Encouraging results: • branchless banks reach remote areas. In rural Brazil, deposits and withdrawals constitute 38% of transactions compared to 8% in urban areas • eight branchless banks reached 37% of people previously unbanked • Five branchless banking providers reached more unbanked people than the largest MFI in country • The same five providers grew rapidly, needing on average three years to acquire more unbanked clients than the largest MFI in the same market
  5. 5. IFAD-WFP Weather Risk Management Facility • a joint initiative of IFAD and WFP with support from Bill and Melinda Gates Foundation  Objective Increase access of smallholder farmers to a wide range of risk management tools
  6. 6. WRMF focus The WRMF focuses on four areas: • Building the capacity of local stakeholders in weather risk management. • Improving weather and climate services, infrastructure, data monitoring and management • Supporting the development of an enabling environment • Promoting the use of technology to complement ground-collected data (e.g. use of satellites, remote sensing applications)
  7. 7. WRMF main outputs • pilots in Ethiopia and China • Technical publication on: ‘Potential for Scale and Sustainability in Weather Index Insurance for Agriculture and Rural Livelihoods’ www.ifad.org/ruralfinance/wrmf/index.htm • A technical guide for donors: Effective ways to support index insurance • Mapping exercise with Wageningen University to determine crop vulnerability to weather and climate risk, also relative to weather data availability and household socio-economic conditions
  8. 8. Rural remittances Did you know that: • 30 to 40% of remittances goes to rural areas • Thanks to high mobile penetration rates in rural areas, more and more money is being transferred using using mobile phones Did you know that: • over 200 million people going north send home $350 billion • Remittances to developing countries total 3 times Official Development Assistance (ODA)
  9. 9. Remittances and mobile banking Konecta in Paraguay: launching a new technological platform service for fast money transfer services targeting 75,000 people IOM and Crystal Fund in Georgia: setting up a mobile remittance platform integrating microfinance institutions and commercial banks, to provide microloans, microsavings, and micro health insurance products Example of IFAD’s projects using m-banking & m-remittances ACCESS Bank Madagascar: piloting a wired and mobile IT platform to link MFIs and remittance companies to small farmers and families of migrants in rural areas
  10. 10. Pro-poor value chain programmes Smallholders in Value Chains: • Usually disadvantaged because they lack information, which affects their negotiations with other actors in the chain. Benefits: Reduced transaction costs Overcoming information market failures Improved communication along the value chain Input suppliers Customers’ feedback Buyers (actual and Potential) Market prices Product specifications Storage facilities Transportation Packaging Operations Weather Input prices Small- holders
  11. 11. Pro-poor value chain programmes: Access to information Zambia National Farmers Union (ZNFU 4455): Business model  Service focused on needs of smallholder farmers, producers and traders  Provided focused and targeted market information  Easy to understand, little or no bells and whistles  Covered entire value chain  Open to all farmers – no registration fee for farmers  Traders need to register  Local content and no massive pushing  Sustainability: through advertisement ©IFAD/Mwanzo Millinga Results  Smallholder farmers better access to market info and participate on equal footing with traders  Improve negotiating power  Reduce transaction cost  Win-win: convergence with radio, mobile phone and internet  service has had positive impact say:  90% traders  60% farmers  40% negotiated better price  Over 50% increased income
  12. 12. Where to next? • How do we move from piloting and more piloting to mainstreaming ICT4D in development activities? • What is the future of m-applications? • When will we all embrace m-development? • Is public-private partnership really the panacea? • What are other viable business models to embed ICT4D in rural development projects?

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