Zambia scales up agriculture e-voucher scheme

[LUSAKA] Zambian farmers could gain faster access to agricultural products and services with an  electronic voucher scheme.

The ‘e-voucher project’ — the first of its kind on the continent, according to participant Mobile Transactions Zambia Limited (MTZL) —  covers the delivery of products including seeds, fertilisers and herbicides.

Initial tests carried out in 12 districts this summer showed promising results, so the pilot was scaled-up and is now undergoing tests in 28 districts.

It is a joint venture between the Zambian government and the UN Food and Agriculture Organization (FAO) with €7.5 million (US$9.7 million) of funding from the European Union and €5 million (US$6.5 million) from the Norwegian government.

Farmers who register with the scheme are eligible to receive pre-paid mobile phone vouchers, each worth around US$53, to use at agro-dealers.

The software for the system has been developed by MTZL and approved by the Bank of Zambia as eligible to make payments. It processes more than 40,000 vouchers worth over US$800,000 each month, according to MTZL.

“We are using mobile technology to improve access to financial services, and change the way companies, NGOs [non-governmental organisations], and government work with the banked and the unbanked,” Hans Hesse, e-voucher manager at the company said. “Our vision is a cashless Africa.”

The e-voucher system is the first of its kind in Zambia and unique across Africa, although a similar system using printed vouchers has been used in Rwanda.

“It replaces and enhances previous voucher systems that worked using paper vouchers,” said Hesse. “E-vouchers are more secure and allow instantaneous payment to the agro-dealer.”

Rogers Phiri, president of the National Association for Peasant and Small-Scale Farmers, said the e-voucher will help avoid monopoly by any single agro-distributor, and bring services closer to farmers.

FAO country representative, Noureddin Mona, told SciDev.Net the project strengthens the distribution chains by stimulating competition in the market. It also speeds up payments to agro-dealers and helps them build better links with the wholesaler suppliers.

“It gives farmers a choice in where they want to spend their money,” Monda said. “A farmer can use their voucher at any participating agro-dealer.”

But Agnes Yawe of the Participatory Ecological Land Use Management said other operational factors will determine the final benefits to the small-scale farmers.

“The e-voucher system will only be appropriate if the voucher pack provides for diversity of inputs and services for a farmer to choose from,” she said and added that major input distributors and stockist have good urban networks but still lack rural networks.

Source – SciDev.Net – Newton Sibanda – 30 Nov 2010