An industry providing potentially about 70% of a country’s GDP and more than 80% of employment should be considered to be of great importance. This is agriculture, of course, and more specifically farming. Across most of sub-Saharan Africa, farming (small-scale farming, in particular) is the primary livelihood of the majority of the population.
With economies growing at breakneck speeds, and urban centres straining to keep up with the influx of migrants looking for jobs, the small-scale farmer often gets left in the dust. Africa has the ideal makings of a farming community, but faces many challenges, even when blessed with fertile soil, ample land, water, and labour closely tied to the land. The question is: how can the African small-scale farmer be helped to become more productive?
As a child growing up in the rural part of North-Western Zambia, I noticed that small-scale farmers were faced with many constraints and challenges. These include: the continued practice of convectional farming, reliance on ever-uncertain rainfall, high cost of seed and fertilizer, low yields and a subsequent exploitation by middlemen—which have resulted in a vicious cycle of hunger and poverty among small-scale farmers.
In trying to make a difference and help provide solutions to these constraints and challenges One Pack Farm Finance (OPFFIN) was formed. OPFFIN is an agribusiness enterprise that lends farming inputs (seeds and fertilizer) to small-scale farmers and they repay in-kind with bags of maize after harvest.
What is One Pack Farm Finance All About?
OPFFIN Business Solution Model
Using a market-based approach, OPFFIN facilitates activities and transactions at two levels of the farming value chain, including seed and fertilizer sourcing, and market support. Farmers get inputs at the start of the farming season and are required to repay when they harvest. The enterprise also provides market for these farmers and more others who are not on the scheme to sell their produce. A complete set of services is indeed provided within walking distance of the farmers we serve. Our service bundle includes:
- Financing for farm inputs
- Market facilitation to maximize profits from harvest sales
How it Works
The model is based on the solidarity group lending system were farmers are grouped into small groups of five to ten people co-guaranteeing each other. The groups register with the manager, then a background check is done on the clients to assess the capability of repayment. Upon approval, the group is eligible to access the inputs when the distribution period starts. Client farmers are expected to repay in kind with the number (quantity) of bags agreed.
What has been done so far?
OPFFIN have already acquired land (a farm in the area) and a manager is already on the site who has been interacting with our farmer members. We have so far reached a clientele of about 80 farmers with good repayment record (90% collection). Right now we are in the process of reaching out to the seed and fertilizer companies for supply of inputs at subsidized prices and also in the process of forming and dividing the existing clientele into solidarity groups.
OPFFIN Sustainable Model
OPFFIN is currently targeting 5,000 farmers in Kapiri Mposhi District of Central Province Zambia, but the enterprise has plans to expand to other parts of the country. The enterprise is also planning to expand in other areas by providing the farmers with technical know-how and the agronomic practices (new farming technologies, climate change, conservation farming, etc.) to maximize their yields and profit margins.
Our success indicators will range from the yield-per-hectare of maize and soya bean fields, and between the quantity of inputs required and output sold every year. We also want to measure our success based on the number of farmers joining the scheme on a yearly basis.
Construction of the warehouse USD 1,500 Immediately funds are given
Laptops (2) USD 500 Immediately funds are given
Labour USD 500 Distribution Period
Inputs USD 2,500 August 2016
Given Chipilipili is a 28-year-old agriprenuer residing in Lusaka, Zambia. He has the passion for farming and the zeal of lifting small-scale farmers out from the vicious cycle of poverty by empowering them through proper input-supply-chain management, trade, and agronomic practices. He Holds a BSc in Agricultural Economics and more than two-years’ working experience in different institutions and microfinance.
Blogpost and picture submitted by Given Chipilipili (Zambia): given.chipilipili[at]gmail.com
The content, structure and grammar are at the discretion of the author only.
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