Reconnu comme l’un des 100 meilleurs influenceurs de LATTICE80 en 2019 dans l’agenda des objectifs de développement durable des Nations Unies pour avoir été le premier à utiliser la technologie blockchain pour aider les petits exploitants agricoles en Afrique subsaharienne, Hirander Misra partage son point de vue sur la manière dont les solutions blockchain tiennent la promesse de transformer le paysage de l’inclusion financière dans les économies en développement.
Named as one of LATTICE80’s Top 100 influencers in 2019 under the UN Sustainable Development Goals agenda for pioneering the use of blockchain technology to help smallholder farmers in sub-Saharan Africa, Hirander Misra shares his expert insights on how blockchain solutions hold out the promise to transform the financial inclusion landscape in developing economies.
The 2030 Agenda for Sustainable Development, adopted by all United Nations Member States in 2015, provides a shared blueprint for peace and prosperity for people and the planet, now and into the future.
At its heart are the 17 Sustainable Development Goals (SDGs), which are an urgent call for action by all countries – developed and developing – in a global partnership. They recognise that ending poverty and other forms of deprivation must go hand-in-hand with strategies that improve health and education, reduce inequality, and spur economic growth – all while tackling climate change and working to preserve our oceans and forests.
Against this broad context, mobile and electronic banking as well as payments systems can add real value if rendered in an integrated manner to many millions who do not have access to financial services, thus delivering against many of the SDGs. In particular, the use of blockchain technology for social good is an enduring theme that promises to transform the financial inclusion landscape in Africa.
Farmers to harvest blockchain benefits in sub-Saharan Africa
Agriculture is indeed a huge market in Africa supporting many livelihoods – 700 million Africans are farmers. Yet, Africa is a net food importer, with its annual bill being USD35 billion and estimates pegging it at USD110 billion by 2025. In this vast continent of over 30 million km2, poor management of land resources, coupled with inefficient banking practices bound in red tape, hinders economic growth and leaves most farmers marginalised.
Furthermore, infrastructure continues to be a grave concern. The lack of access to services that developed countries would take for granted sees millions of Africans unsupported when it comes to financial infrastructure. Loans, credit lines and savings accounts are some of the opportunities which remain unavailable to many. The current financial system has made individuals reliant on many middlemen.
This is where blockchain, with its ability to cut out the middlemen, promises to make a significant change to smallholder farmers’ plights. Lower costs and greater coverage through use of new technologies such as blockchain via initiatives such as FinComEco are geared to enable unbanked smallholder farmers in sub-Saharan Africa to feed their families by providing transaction security, eliminating corruption, reducing borrowing costs, and ensuring liquidity for the purchase of inputs by guaranteeing the sale of produce.
In the case of the ACE agricultural commodity exchange in Malawi, introducing prices on the mobile phones of farmers and making the banks compete online to lend, coupled with making the exchange more accessible so they could sell their produce directly, saw 47,000 smallholder farmers’ incomes go up 31%, with US$10 million of finance provided during 2017.
Tokenisation could also provide a massive influx of capital to help unbanked farmers in Africa. A token-based ecosystem would enable farmers to deploy the profits from the sale of their surplus crops in the wider economy. The intention is to recruit local vendors and service providers as well as medical and educational institutions to redeem the tokens. As incomes grow, as does access to capital, it can facilitate the process of taking business loans, purchasing cars and buying homes, helping to enhance standards of living.
Blockchain embraces financially marginalised communities
Banking and financial services are a privilege for many in the developing world. According to the World Bank, as of April 2017, 1.7 billion adults globally remain unbanked, yet two-thirds of them own a mobile phone that could help them access financial services. Digital technology could take advantage of existing cash transactions to bring people into the financial system, the report finds.
For example, paying government wages, pensions, and social benefits directly into accounts could bring formal financial services to up to 100 million more adults globally, including 95 million in developing economies. There are other opportunities to increase account ownership and use through digital payments: more than 200 million unbanked adults who work in the private sector are paid in cash only, as are more than 200 million, who receive agricultural payments.
In view of the above, the overriding challenges for financial institutions are to address the constraints of poor connectivity, non-existent credit history and diverse customer profiles, and to scale up their operations in unbanked sectors. To help the banking sector counter these pressing challenges, the United Nations, along with the World Bank, has come up with a commitment for creating “Universal Financial Access” by 2020. This will cover 25 countries and target 75% of the financially excluded.
Mobile money matters
A recent World Bank report on the use of financial services finds that, globally, 69 percent of adults – 3.8 billion people – now have an account at a bank or mobile money provider, a crucial step in escaping poverty.
Indeed, the mobile has been revolutionary in creating a new paradigm for the spread of financial services in unbanked areas. Though technology is being seen as the biggest enabler in boosting financial inclusion, it is the collaboration and alliances between Fintech and traditional financial institutions that will define its future. As of now, while it is clear that financial inclusion is on the rise globally, accelerated by mobile phones and the internet, gains have been uneven across countries.
The most significant example of achieving financial inclusion is M-PESA in Kenya and its adoption by other countries. No wonder then that, according to the World Bank, as of April 2017, in Sub-Saharan Africa, mobile money drove financial inclusion. While the share of adults with a financial institution account remained flat, the share with a mobile money account almost doubled to 21 percent.
Since 2014, mobile money accounts have spread from East Africa to West Africa and beyond. The region is home to all eight economies where 20 percent or more of adults use only a mobile money account: Burkina Faso, Côte d’Ivoire, Gabon, Kenya, Senegal, Tanzania, Uganda and Zimbabwe. Opportunities abound to increase account ownership: up to 95 million unbanked adults in the region receive cash payments for agricultural products and roughly 65 million save using semiformal methods.
Going forward, blockchain and artificial intelligence are increasingly likely to complement each other as some of the technological constraints are eliminated. As the internet of things (IoT) is setting us up for a revolution of connectivity, the advent of decentralised blockchain and centralised artificial intelligence could result in a huge positive social impact and financial inclusion in emerging economies. Likewise, a significant number of Fintech companies have adopted crowdfunding as the model of financial inclusion.
Getting all the stakeholders together and creating a win-win proposition for each and every one will lead the way towards creating a financially included society. All in all, new technologically-enabled structures are fast emerging to shake up the status quo, at just the right time.
In this two-part interview, we are going to navigate through Hirander’s success story, his vision of the world, specially highlighting those aspects regarding crypto and blockchain and how he has applied that into his professional projects, including those trying to make a real impact in millions of people’s life.
In this second part, focus was on those projects that Hirander Misra is currently involved with, including GMEX Group, the MINDEX gold ecosystem and FinComEco, a pan-African agricultural exchange ecosystem.
In this two-part interview, we are going to navigate through Hirander’s success story, his vision of the world, specially highlighting those aspects regarding crypto and blockchain and how he has applied that into his professional projects, including those trying to make a real impact in millions of people’s life.
In the first part, focus was on his personal career and the opportunities and challenges that new disruptive technologies such as crypto and blockchain are facing. And how they are impacting the world right now.
By Hirander Misra, Chairman of GMEX Group & MINDEX Holdings and Co-Chairman FinComEco
The 8th – 10th May AFSIC Investing in Africa conference had financial inclusion through the use of blockchain high on the agenda.
A panel discussion entitled “The Rise of Blockchain Solutions and Impactful Finance”, which I was fortunate to participate in along with other industry experts, resulted in the following key takeaways:
Growth constraints: Agriculture is indeed a huge market in Africa: 700 million Africans are farmers. Yet, Africa is a net food importer, with its annual bill being USD35 billion and estimates pegging it at USD110 billion by 2025. In this vast continent of over 30 million km2, poor management of land resources, coupled with inefficient banking practices bound in red tape, hinders economic growth and leaves most farmers marginalised.
Lack of financial infrastructure: The lack of access to services that developed countries would take for granted sees millions of Africans unsupported when it comes to financial infrastructure. Loans, credit lines and savings accounts are some of the opportunities which remain unavailable to many. The current financial system has made individuals reliant on many middlemen.
Blockchain powers impactful finance: Blockchain has two major advantages for banks – it enables them to save money by streamlining and also speeds up transactions. Lower costs and greater coverage through use of new technologies such as blockchain via initiatives such as FinComEco will enable unbanked smallholder farmers in sub-Saharan Africa to feed their families by providing transaction security, eliminating corruption, reducing borrowing costs, and ensuring liquidity for the purchase of inputs by guaranteeing the sale of produce. In the case of the ACE agricultural commodity exchange in Malawi, introducing prices on the mobile phones of farmers and making the banks compete online to lend, coupled with making the exchange more accessible so they could sell their produce directly, saw 47,000 smallholder farmers’ incomes go up 31% with USD10 million of finance provided.
AI to complement blockchain: Blockchain and artificial intelligence are increasingly likely to complement each other as some of the technological constraints are eliminated. As the IOT (internet of things) is setting us up for a revolution of connectivity, the advent of decentralised blockchain and centralised artificial intelligence could result in a huge positive social impact and financial inclusion in emerging economies.
All in all, the rise of new technologically-enabled structures promises to shake up the status quo, at just the right time.
How mobile and blockchain technologies are changing farming
More than half of Africa’s population is involved in agricultural production in some way. Many are smallholder farmers, which usually means they own small plots of land and grow one or two cash crops that rely almost exclusively on family labor. Smallholder farmers in Africa often have inadequate access to the financial services that many of us take for granted. Their lack of access to resources results in ineffective commodity pricing and logistics, leading to weak profits.
Technology is starting to make a difference, however. Mobile phones are helping farmers conduct transactions and gain access to payment services. One organization that’s helping lead the way is FinComEco, a platform that helps farmers get current market prices on commodities through their mobile devices. The platform also helps them bring surplus crops to warehouses so they don’t miss out on potential income.
Many banks in Africa don’t have the infrastructure or the money to offer electronic resources like mobile apps for banking, so tech companies are filling the gaps. Farmers who are paid electronically through mobile apps can allocate payments towards buying necessary services. In the future, tech entrepreneurs plan to offer more banking services including loans.
Since FinComEco launched last year, it’s forged agreements to work in Zimbabwe, Mozambique, Ghana, and Uganda, and is in discussion to operate in 18 other African countries. The company plans to bring in external investment to make new warehouses for farmers. FinComEco has a joint venture with UK listed company Block Commodities called FACES (Food Asset Commodities Ecosystem) Blockchain. FACES Blockchain has partnered with Swarm Fund to help raise capital using blockchain technology via a cryptocurrency called FarmCoin. This partnership aims to provide a massive influx of capital to help a good proportion of the estimated 700mn unbanked farmers in Africa.
Cryptocurrency could play a major role in the future of smallholder farming in Africa. With platforms like Swarm, investors all over the globe can support these initiatives in Africa and the innovative technologies that support new paradigms for the continent’s millions of smallholder farmers.
With an influx of investor capital, companies like FACES Blockchain can provide loans to farmers. Crypto assets unlock an alternative means for finance, partly because crypto asset holders aren’t earning interest. Crypto loans can therefore be provided much more cheaply than traditional banking loans, unlocking millions of dollars that otherwise wouldn’t have been available. FarmCoin can be used as a means of alternative finance, which can help farmers buy more cost effective and better inputs (pesticides, fertiliser and seeds) as well as much needed farming equipment aiding automation and therefore facilitating capacity building and increased productivity. It therefore acts not only as a utility token but also an asset backed infrastructure investment token.
Further down the line, FACES Blockchain – working with other entrepreneurs in tech and crypto – hopes to build an “app store” for African farmers that allows them to access resources and boost their profits more effectively using FarmCoin as a medium of exchange. This app store could also link farmers to warehouses and banking solutions, along with other services like loans, crop insurance, and agricultural inputs. Farmers will benefit by competition from service providers to deliver the best service at the best price, and service providers will benefit by having access to thousands of farming customers.
FACES Blockchain and others are excited about the future of technology and cryptocurrency in Africa, and are keen to work with development finance institutions such as the African Development Bank to create value add. There’s great potential for tech leaders in Africa to make an impact by collaborating with the World Food Programme, the Food to Market Alliance, the United Nations and more. Many projects are working to make a difference in Africa, and connecting farmers through cutting edge technologies and access to investment is just the beginning.
Block Commodities and FinComEco Joint Collaboration Agreement with OST to unlock consumer goods, education and healthcare for African farmers utilising the Blockchain
Block Commodities Limited and Financial & Commodities Ecosystem (FinComEco), a subsidiary of GMEX Group Ltd, are pleased to announce a strategic partnership with OST, the complete blockchain toolkit for business.
The collaboration facilitates the launch of a token-based ecosystem which will enable sub-Saharan farmers to deploy the profits from the sale of their surplus crops in the wider economy by being rewarded in FACES (Feed Africa Commodities Eco-System) tokens powered by OST technology and the OST token. Block Commodities Limited and FinComEco are endeavouring to build an ecosystem of ecommerce partners featuring local vendors and service providers as well as medical and educational institutions, where the FACES tokens can be redeemed. The OST utility token enables any website, app, or marketplace to easily launch a branded token and integrate it into their business.
Block Commodities’ Executive Chairman Chris Cleverly said: “The sub-Saharan region tends to have fewer fungible currencies but higher interest rates, which outside agencies base on perceptions of Africa rather than its realities. This, with the region’s need for secure relationships to thrive, as well as its recent history of rapid technology take-up, means that Africa is likely to see the fastest blockchain growth.”
Chairman of GMEX Group and CEO of FinComEco, Hirander Misra commented: “The utility OST tokens enable consumer transactions to become part of the FinComEco and Block Commodities supply to demand value chain, which helps facilitate a sustainable and increasing improvement in the sophistication and living standards of smallholder farmers and their families across Sub-Saharan Africa”. He added, “This enables the ‘unbanked’ not only to gain access to these services but also facilitates increasing consumer demand as incomes rise across a whole range of goods and services. This, in turn, leads to financial inclusivity and has a positive social impact.”
OST Founder and CEO, Jason Goldberg, commented: “OST enables any company or project to deploy branded cryptocurrency tokens backed by the market value of OST, on scalable utility block chains. We are thrilled to partner with GMEX Group, Block Commodities, and FincomEco to blockchain enable the African agricultural market.”
About Block Commodities
Block Commodities’ strategy is to maximise the value of African agricultural and other commodities through the deployment of blockchain technology. The resources will be linked through the vertical integration of primary industries down to consumers via blockchain platforms. Using blockchain’s ability to dynamically incorporate all market participants into an efficient ecosystem, Block Commodities aims to facilitate the commercial operation of such ecosystems in the context of the agricultural production cycle.
In reclaiming the value lost in African agricultural and extractive industries through inefficient supply and distribution systems, Block Commodities aims to help sub-Saharan African farmers raise productivity and secure better returns for their produce. This is an important step in establishing African communities as significant future global agricultural producers.
FinComEco, a fully integrated Financial & Commodities Ecosystem, is a corporate venture to provide an ecosystem of services, financing, capacity building and enablement solutions underpinned by technology, to drive an improvement in food security and economic diversity through socially responsible commercial means (as opposed to charity), to foster financial inclusion.
FinComEco is the joint venture partner of Block Commodities for developing and operating a range of platforms/projects and initiatives in the agricultural commodity markets sector in sub-Saharan Africa.
For more information visit www.FinComEco.com
FinComEco is a subsidiary of GMEX Group, an innovative provider of exchange and post-trade business services and technology.
For more information visit www.gmex-group.com
OST is building “the complete blockchain toolkit for business”. The Berlin start-up strives to be the blockchain technology partner of choice for businesses of all sizes and levels of technical sophistication, enabling any business to create, launch, and manage their own branded digital token economy powered by OpenST protocols and OST blockchain management software. The OpenST protocol enables companies to launch branded token economies on highly scalable, open, cryptographically auditable side blockchains.
By Hirander Misra, CEO of GMEX Group and Deputy Chairman of FinComEco.
To learn lessons for the future we have to look at the past.
A few thousand years ago, when money never existed, a transaction happened only by exchanging agreed commodities by barter. E.g. Panchgani in Maharashtra where I recently held a TEDx talk on the subject I am writing about now is famous for strawberries – if you had strawberries and someone had cows to produce cream you could exchange a given amount of milk for a given amount of strawberries based on a discussion to determine the value of each and you both now could happily eat strawberries and cream. Life was simple and easy to understand.
A few centuries ago, with an inception of globalisation and increase in population the trade happened by exchanging commodities with rare materials like gold and silver.
Moneylenders in the past filled the gaps left by banks and still exist today. The Venetians were key players in the 1300s. For example moneylenders keep your gold and lend you money and charge you interest but if you did not pay it back they keep your gold.
Around 16th century, the current banking system started evolving. Banks started to print paper currency. They were printed on the basis of gold reserve but from 1973 this backing by gold was removed as part of the Breton Woods Agreement as backing by gold was expensive. From then on faith in currency is based on trust. This is not different to Bitcoin, a virtual currency today, whose value is based on expectations and hence trust.
At the time of the 16th century exchanges also came into being. An exchange is a central meeting place for buyers and sellers and came because in era before computers more buying and selling could be conducted in a concentrated location. This was really the start of the evolution of an exchange and money as we understand it. In 1602 a central place for buyers and sellers to trade with each other was established in Amsterdam which became known as Amsterdam Stock Exchange albeit the Belgians claim the first exchange since 1531.
From the 1990’s stock markets become more electronic gradually in the most part replacing trading that was done on the open outcry floor of a stock exchange to computer based trading. Then the financial crisis happened in 2018 and many individuals and companies were impacted by the reckless greed of a few.
This financial system has made individuals reliant on middlemen be it a bank or a broker and even in cases, exchanges with dominant position. Financial markets have became complex to understand and expensive in many cases with a never ending era of products available to the unassuming consumer. The system the rough the centuries has become unfairly priced and complex. For example you may only receive 50% of the value of your gold as a loan and 20 percent interest may be paid for it. Is it fair?
Banks do the same with assets but one can argue in this era of technology the value of the services provided is too expensive relative to the overhead to deliver those services. Greed has led to a complex financial system that few understand with lots of vested interest. Every day people are exploited by the system and I am not saying the system is not needed but it needs to change. How can we bring fair level playing field to eradicate disparity – but also with social reform, which is impactful and sustainable? This niggling thought really hit home to me in 2008 when I was COO of an innovative electronic stock exchange called Chi-X Europe, which I had co-founded. Lehman one of our clients went bust in front of my very eyes and Fortis Bank our clearing bank nearly went the same way until the Dutch Government bailed it out. Global financial meltdown ensued. I realised that the system was flawed and there must be a better way. Yes the system had to exist with better controls but it had to reach back to grass roots level as it had become so far removed from reality.
We at GMEX Group have personal experience of this as a company. In 2015 we started working with the Agricultural Commodity Exchange for Africa (ACE) in Malawi after a fortuitous meeting with Kristian Shach Moller in a hotel bar at a conference in Switzerland. This exchange, which deals with grains and pulses but was struggling to reach the end smallholder farmer that it was set up to facilitate in a meaningful way as only 5% of its activity was farmers selling their crop direct to market. Middleman which at the time added no value were giving smallholder farmers 10% of what their commodity was worth and the banks despite having the commodity as security much like a money lender keeps gold still lent at 30-40% interest rates and that too to only 60% of the value. The farmer took all the risk but was left struggling to feed his or her family. By introducing prices on their mobile phones to farmers and educating them as well as making the banks compete online to lend in addition to brining in cheaper finance through mobile/ electronic banking coupled with making the exchange more accessible for them to sell their produce directly, in one year in 2016 the incomes of 47,000 smallholder farmers went up 31%. $10mn worth of finance was provided and that would have been $110mn if there had been better access to finance. This would have then benefitted nearly 500,000 smallholder farmers.
This lead us to realise that technology instead of being exclusive could become more inclusive and transparent. More income leads to social welfare, women’s empowerment, children’s nutrition as we saw in Malawi. Value add now can move from being farmers growing tomatoes to produce tomato paste (add value) and then have demand for financial services personally like mortgages and loans that are priced right. The unbanked start to become banked.
We further realised that this issue was prevalent across all other parts of Sub-Saharan Africa as well as Latin America and South East Asia. Take coffee as an example, we in a fancy coffee shop were paying £2.50 a cup yet the end farmer was lucky if he got £0.10. As such positive change in a sustainable manner where we made people reliant on commercial enterprise not charity hand outs could lead to a massive positive impact on a global scale.
This led to the creation in 2017 of a dedicated initiative by us to facilitate this called FinComEco (Financial and Commodities Ecosystem). This has led to engagement in 21 African countries as well as 3 outside the continent but with lots of work to be done to fully convince governments and stakeholders in many of these to not only do this but also do it in a proper fashion involving all key areas fully linking farming to the end value chain of demand. A middleman for agriculture still has a role to play much like they do in financial services but it was those who could add value be it by making the smallholder farmer bigger and influential by grouping/ aggregating production or offering convenience such as transport to get it from the farm gate to the warehouse were the ones which would now prevail in this new world. The farmers in the case of ACE can now choose how they sell, when and how they got a fair loan to buy fertiliser and seeds when they needed it at the outset. The exchange now enabled by technology is at the heart of that to ensure that technology is used for good. This is applicable to many different sectors and we are also now starting to do the same through a separate India based initiative we announced in December 2017 for rag pickers and others who generate waste to creating an exchange for waste such as cow dung, etc to bring valuable incomes to those who need them most. Not to also mention the positive environmental impact this will have. This also supports the Indian Government’s Clean Ganga and Swach Bharat initiatives but is not just an India problem it is a global one as rich and poor countries all produce waste and most of it ends up in our oceans destroying marine life.
Ultimately billions people can benefit if these types of initiatives are rolled out more widely leading to positive change by other organisations be they public or private. Corporate Social Responsibility is not just about meeting targets for CSR budget spend any which way as it has to be more than that. Equally executives at development finance institutions have to galvanise their organisation as many are acting like private equity houses and not looking at a 10 year view for sustainable socio economic reform no matter what the PR ad rhetoric lends us to believe. The number of times we have knocked on such doors and been told that we should come back when we have a track record and profitable on such ventures for funding so we can scale further and that we should be three years old as an enterprise. If that was the case why would we need them at that stage? We are not the only ones that face this predicament.
We as the individual are the ones that have to drive this change. So it’s no surprise that we find ourselves in an era “Democratised Disruptive Innovation” (DDI as I term it) enabled by technology, where 1 month is like living 10 months in terms of opportunity and development and it is not inconceivable that in 5 years time organisations not only such as Google could be a bank and banks as we know it would be different as even we individuals could lend and borrow more and more from each other as we have seen with some tech initiatives with peer to peer lending emerging. In the last few weeks two large company CEOs have approached me that are successful as they reflected over the holiday period and said we make lots of money now but we can see that either we change or someone eats our lunch. Look at what digital cameras did to Kodak which is a shadow of its former self.
Now we can trade with each other direct by technology whereas in the past you had to be in local area and Now national and international. Anyone will be able to trade with anyone with transparent in an open manner with more consideration to just financial services. We are in an era of “Anyone to Anyone trading .“ The intermediary (middleman) is now technology and this means massive opportunities not only for companies like Google who can from nothing in 20 years to become a giant worth about $700bn USD but also for us as the individual as anything is possible. I am not saying that there is not a need for a middleman, but this match making is needed at a better price and continually needs to evolve.
We have come back full circle to the new age of barter between all of us but with online convenience to coexist with the current exchange and financial services ecosystem but technological enabled change is making it more practical, more efficient and more accessible. So we can now all embrace change and use it to empower ourselves in any manner we choose, when we choose. Whether change is the only constant (the overall theme of TEDx Panchgani) or there needs to be constant change in the way you do things is now for you to decide how best to democratise.
I recently read an interesting blog by Margaret Miller at the World Bank – Can ‘fintech’ innovations impact financial inclusion in developing countries?
It stated that “fintech,” has been reshaping the financial services industry attempting to address financial inclusivity in the African region – I use the phrase inclusivity rather than inclusion as sometimes I believe that its an excuse for may providers to deliver a “second class product “ – we should be aiming for a first class product available to as wider audience as possible – inclusivity !
Margaret asks that given that they work in various areas of financial inclusion they are interested in new ways that can help expand access to financial services to hard-to-reach populations and small businesses in developing countries.
Margaret highlights the key takeaways she found relevant to their work of extending access to finance to the two billion people who are currently left out of the formal financial system. These were Fintech as partners with banks (and competitors), Importance of data Consumer protection Customer-focused business Finance embedded in transactions Voice, not text, as the next major interface Strong interest in the legal and regulatory framework and Many interesting new business models.
I agree the points made – but when it comes to financial inclusivity we need to ensure that we are putting together a sustainable ecosystem to deliver real change that will not only impact on the individuals but on the commuinities that they live in and therefore offer the greatest opportunity for developed Financial Services system that is trusted.
At FinComEco we intend to encourage growth by connecting the farmer with the exchange, financial infrastructure and national economy through partnerships. This supply to demand chain also includes small-scale traders, brokers, storage, transportation, shipping, banks and buyers including multinationals. This will enable smallholder farmers to get a better price for their produce, and provide opportunities for further income growth, opening alternative added-value opportunities including e-commerce enabled enterprise and the data that provides will enable even greater product and service enhancements.
FinComEco has already successfully proven this concept in Malawi at the Agricultural Commodity Exchange for Africa (ACE) through the GMEX Group. During 2016 substantial benefits were delivered to smallholder farmers with an average 31% increase in income from use of warehouse receipts and better price transparency with 47,000 registered to receive the latest market prices on their mobile phones.
FinComEco will establish or reinvigorate local commodity exchanges underpinned by trading technology, electronic warehouse receipts and a complete mobile banking solution. It will also enable trade across multiple regions and deliver a holistic secure cloud-enabled financial agri-ecosystem in partnership with development organisations, governments, research bodies and the private sector.
This will enable the highest level of consumer protection and customer focused business as we will be working with local on the ground partners using the latest technology but also trusted local partners to work with the local community
Delivering the FinComEco solution requires us to use the latest technology, close partnerships with local agencies together with high levels of regulatory and legistative compliance nationally.
Steve Round, Director of FinComEco, CEO at Saescada and Chair at The Big Issue Foundation and Ecology Building Society commented, “There are massive financial inclusivity and food security issues across the developing world with not enough being done in a cohesive fashion to address some of them,” he added, “I am delighted that our mobile electronic banking and payments system can add real value, in this unique integrated solution, to many millions of farmers delivering against many of the United Nations Sustainable Development Goals and it is a first class product ! “
Women smallholder farmers form the backbone of Malawi’s agricultural workforce, yet their average productivity per hectare still remains far lower than that of their male counterparts. In this article, Mike O’Hara and Nicola Tavendale of The Realization Group discuss with Hirander Misra of GMEX Group and FinComEco, Kristian Schach Møller of the Agricultural Commodity Exchange for Africa (ACE), Saskia Vossenberg of the Royal Tropical Institute (KIT) and Alice Kachere, a smallholder farmer in Malawi, how technology and other business initiatives can help redress the balance.