KENYA – Through a financing agreement between Family Bank and DigiFarm, smallholder maize farmers in Embu County are set to benefit from access to digital credit for inputs and insurance to boost production.

DigiFarm is a free Safaricom service that offers farmers convenient, one-stop access to quality farm inputs at discounted prices, input loans, learning content on farming as well as access to the market.

This partnership comes following a program spearheaded by the International Food Policy Research Institute which has set out to implement a risk-contingent credit program to assess whether innovative insurance products can increase access to finance by smallholder farmers.

According to the Kenya Broadcasting Corporation (KBC), farmers based in Mbeere North and South sub-counties will be able to borrow and access the funds digitally through the agri-tech platform.

The financing targets smallholder farmers with a maximum of two acres each.

Seema Gohil, Director, Digifarm highlighted that the mobile service will continue to leverage technology and partnerships to reduce the financing gap faced by smallholder farmers and drive climate-resilient solutions.

“Through our platform, farmers are able to access a full range of services to drive production improvements. They receive agronomy advice, credit for inputs, insurance, and other services and can then connect with buyers during harvest,” Gohil explained.  

In addition to financing, the farmers will receive innovative insurance, training on sustainable agricultural practices, market linkage, and financial literacy to promote farming resilience and produce.

Arid and Semi-Arid Land (ASAL) counties such as Embu often face low agricultural produce due to production shocks such as droughts and diseases.

According to the Economic Survey 2023 released by the Kenya Bureau of National Statistics, the production volume of maize in Kenya declined by 6.5 percent to 34.3 million bags in 2022.

Aristarchus Kuria, Family Bank Lead Digital Transformation said that despite the high vulnerability to the impacts of climate change and market inefficiencies, farmers continue to face a lack of access to efficient and convenient funding to buy essential farming products.

He, however, noted that technology adoption and such multisector partnerships are increasing financial inclusion, especially for smallholder farmers.

“As a Bank, our focus has therefore been to always provide end-to-end value to our customers. We are confident that through this partnership we will not only improve farmers’ financial resilience to these shocks but through technology we will reduce their costs and improve profitability that will help break the cycle of low investment and low returns,” he said.

Family Bank and DigiFarm hinted at plans to further extend the partnership to sorghum farmers in Meru County.