Agriculture is a complex business whose knowledge cannot be wholly shared through short codes or short message services.

Charles Dewa

BEFORE the advent of mobile technology, audiences were more captive, allowing newspapers, radio and television to monopolise people’s mind-shares.

Smallholder farming communities and people’s markets reveal that the social element now influences information and knowledge sharing than the media element. Ninety-five percent of smallholder farmers do not read newspapers while only 15 percent of the farmers I have interviewed trust radio as a source of information.

And by telling farmers what they already know, radio only reinforces existing knowledge. New knowledge is now acquired through social media-enabled channels and the people’s markets where face to face interactions are more rich and diverse.

Unsolicited messages from mobile service providers are becoming an unwelcome imposition among farmers and traders. According to farmers, agriculture is a complex business whose knowledge cannot be wholly shared through short codes or short message services.

Forcing an agricultural argument into 160 SMS characters is like trying to reduce a highly technical discussion about butternut production into a poem. Farmers and traders need coherent discussions which trigger active conscious thinking and reflection.

Short message services seem to demand attention when farmers really want coherent discussions that trigger action and tangible solutions. While many farmers and ordinary people are thrilled about the social media phenomenon and continue imagining how it will solve their daily challenges, there is still a lot of digital ignorance. For instance, the majority of farmers and traders cannot tell the difference between the internet and Facebook because they do not understand the relationship between the two.

However, many farmers are convinced social media is filling the vacuum left by the inadequacies of newspapers, radio, television and road shows, among other communication channels. Rather than asking farmers and traders how they make decisions, mobile service providers and banks should see these groups actually make decisions. This can happen in the informal market.

Social media is now empowering farmers and traders to share information in ways that make them influence each other more than advertisements. From a decision making point of view, many farmers ask for information they never use. On the other hand, farmers and traders are quietly making decisions to buy or not to buy, to borrow money or not to borrow based on chatting through social media platforms and face to face conversations in the market.

Disciplined mapping of commodity flows into big markets like Mbare agriculture market from production zones often produces critical insights for agriculture value chain actors. Such intelligence prevents misallocation of resources by farmers, traders and other value chain actors.

In January 2015, a total of 4 582 farmers supplied 42 different commodities to Mbare farmers market, generating a collective Expected Revenue (ER) of US$1,3 million, an increase from December’s figure by 14,5 percent. Holding all factors constant and assuming that each farmer visited the market once, each farmer got an average revenue of US$290,66 a month. This is not a trivial figure in any country.

Many traders move large volumes of agriculture commodities but have no bank accounts because the way banks continue designing financial packages inhibits innovation. Farmers and traders are expected to have a formal mindset. They are expected to open savings accounts in order to create a reserve and buy affordable insurance to protect against unforeseen harm.

While it is clear that the private sector can play a critical role in agribusiness, Zimbabwean banks continue hesitating to support agriculture traders in the people’s market. A major stumbling perception is that poor people like farmers and traders have little disposable income. Banks continue to see the cost of serving farmers and traders as prohibitive and the return on investment as inadequate.

Yet when smallholder farmers and traders access financial products specifically designed for their needs, they embrace and use them effectively. ICTs are effectively addressing obstacles of distance and dispersed location of farmers and traders such that proper funding arrangements can end up fusing informal and formal businesses into a strong industry. According to traders and farmers, most microfinance institutions tend to squeeze out the local money-lending culture rather than complementing.

This is a prevalent practice in the people’s market. Farmers and traders strongly relate around this practice which sometimes takes the form of tradable commodities. Another big problem is that when progressive traders want to grow and push huge volumes, they run into the lending ceiling of microfinance programmes like fixing loan amounts at a maximum of US$1 000.

Consequently, experiences of these traders are not transferred to the formal banking sector. In this vein, it looks like the microfinance community is not able to provide the type of financial migration pathways which allow successful traders to move up to the formal level.

This is partly due to the fact that most local micro finance institutions are financed directly by international development agencies and not by local banks to reach out to farmers and traders. On the other hand, the formal banking sector has zero experience of lending to the poor.

Until banks start treating farmers and traders as legitimate clients who deserve funding, the traditional banking model is heading for extinction. Unfortunately there seems to be a big inertia against change in Zimbabwe’s banking sector. Farmers and traders are still seen as potential savers rather than potential borrowers.

Banks have been designed to lend money to well-established businesses that can totally cover all lending risks. This entrenched thinking has to be turned upside down if banks are going to survive this turbulent economic environment. [email protected]