How Mastercard’s Partnership with EcoBank is Digitizing Agricultural Value Chain in Africa through Farm Pass

How Mastercard’s Partnership with EcoBank is Digitizing Agricultural Value Chain in Africa through Farm Pass

Millions of smallholder farmers in Sub-Saharan Africa now have access to Mastercard’s Farm Pass, a digital platform that makes it safer and simpler for farmers to sell their produce at a fair price. Farm Pass comes as a collaboration between Mastercard and Ecobank Group.

As part of the agreement, Ecobank will use its 33-nation Pan-African network to increase the impact and reach of the Mastercard Farm Pass platform. Sub-Saharan African smallholder farmers deal with a number of difficulties. These include a lack of market access, a lack of working cash to support operations or procure high-quality inputs, and an inability to effectively pay and receive payments. This has caused insecurity, inefficiency, and food and resource waste, making it impossible for farmers to operate sustainable enterprises.

“Food security is a critical and urgent need in these times. We must therefore rise to the task by creating growth opportunities across the agriculture value chain in Africa. Our partnership with Mastercard has come at the right time to accelerate smallholder farmers’ access to urgently needed financial services, which are vital to realising Africa’s full agricultural potential. It will also help deliver value across the agricultural value chain to make farming in Africa more profitable, competitive, and resilient,” says Ade Ayeyemi, CEO of Ecobank Group.

Michael Froman, Vice Chairman and President, Strategic Growth at Mastercard noted that providing a digital platform that makes it simpler for smallholder farmers to transition from subsistence to commercial farming.

“When we empower people, we can power economies and support economic growth that is truly inclusive. Mastercard Farm Pass contributes to this by offering a digital platform that makes it easier for smallholder farmers to move from subsistence to commercial farming. This, in turn, will stimulate agricultural growth, increase competitiveness, and improve food security in Africa,” says Froman.

About Farm Pass

Farm Pass unites multiple supply and demand-side players in the agribusiness in a single agricultural marketplace, boosting their combined beneficial effects on farming communities. Smallholder farmers may obtain quality inputs and farming information, be paid and pay digitally, and build a financial profile that can open up financing options for working capital and inputs. They can also sell their produce for a higher price.

More than 60% of people in Sub-Saharan Africa are smallholder farmers, and the agricultural industry is thought to account for 23% of the continent’s GDP, according to McKinsey & Company. However, barely 3% of the sector receives banking financing, which limits farmers’ ability to expand their businesses or reduce losses from subpar harvests. Farm Pass gives smallholder farmers the ability to generate a digital transaction record that can permit formal credit or other financial services from banks and other financial institutions by linking their companies with payment systems.

Nearly a million smallholder farmers in Uganda, Tanzania, Kenya, and India have access to Mastercard Farm Pass since its inception in 2015, giving them the ability to demand 25%–50% higher prices and boost harvest output. Farm Pass is a component of Mastercard’s strategy to link underserved communities to critical services through Community Pass, a shared interoperable digital platform that supports the company’s commitment to link 50 million small and microbusinesses and one billion people to the digital economy by 2025.