The Agricultural Finance Company Holdings (AFC Holding) will soon introduce a preloaded credit card system allowing farmers contracted under the Presidential Inputs Programme to access agricultural inputs directly from Government-accredited merchants.
This new integrated farmer credit card scheme will enable beneficiaries of the government’s input support programmes to collect inputs such as fertiliser and seed directly from accredited merchants. This eliminates the need to go through centralised distribution points like the Grain Marketing Board (GMB) or Cottco, as is the current practice.
This shift is expected to improve the efficiency and transparency of input distribution. Presently, the scheme’s input distribution is encumbered by logistical bottlenecks, with farmers often facing delays as inputs are transported to centralised distribution points.
The process also involves multiple layers of bureaucracy, which affects productivity and increases opportunities. Under the new system, a farmer will preload each credit card with a specific allocation, which can be used to collect inputs after swiping the card from participating suppliers without intermediaries.
The initiative, spearheaded by AFC Holdings, a government-owned entity under the Mutapa Investment Fund, is designed to eliminate bureaucratic delays, eliminate middlemen, and curb corruption that has long plagued the inputs programme.
In an interview, Mutapa Investment Fund chief executive officer Dr John Mangudya said: “Through AFC Holding, the fund is implementing a sustainable scheme for funding agriculture, including an integrated farmer credit card scheme to enhance efficiency in the distribution of agricultural inputs to farmers.
“You are aware of the Presidential Inputs Scheme under which farmers used to get inputs like fertiliser and seed through the Grain Marketing Board (GMB) or Cottco. We want to transform that through a system whereby farmers get credit cards and go directly to merchants of fertilisers and other inputs under the scheme.”
The new system will allow farmers to swipe for inputs using the cards at accredited merchants, eliminating the need for centralised input distribution points and reducing bureaucratic delays that often hinder timely access to farming resources.
“This improves efficiency and reduces the middleman and corruption,” added Dr Mangudya.
“It also enhances the information we collect — we will now have real-time data on who received what inputs, when and where.”
Under the new model, each card will be loaded with the specific inputs a farmer is entitled to, based on assessments by banks and agricultural institutions involved in the scheme.
“It’s transformative,” Dr Mangudya said. “We are moving with the times. This system is already being implemented successfully in countries like India and Kenya, and we are confident it will work here.”
The credit card scheme also ties into broader national reforms, including the land tenure and title deeds programme.
The initiative is expected to increase access to credit and other support services for smallholder producers by onboarding farmers into formal financial systems.” This also assists with the title deeds programme,” said Dr Mangudya.
“Banks are now recognising farmers as clients with verifiable records.”The new model draws from the successful digital input distribution programmes in countries like India and Kenya, which have adopted innovative subsidy systems to tackle inefficiencies and corruption in agriculture support programmes.
In India, the government rolled out the Direct Benefit Transfer (DBT) for fertilisers, a digital system that authenticates farmers at the point of sale using biometric identification and directly links them to subsidised inputs.
Fertiliser retailers use point-of-sale (POS) machines linked to a central database, ensuring that subsidies reach the intended beneficiaries.
Dr Mangudya stated, “These countries have shown that digitising input distribution works. It improves delivery, enhances transparency and ultimately supports food security.”
Kenya and Nigeria have demonstrated the effectiveness of digital input distribution systems. Kenya’s e-voucher program, launched under the National Agricultural Input Access Programme (NAAIP), provides registered smallholder farmers with electronic vouchers via mobile phones. These vouchers can be redeemed at authorised agro-dealers for subsidised fertiliser and seed. The World Bank-supported system has improved targeting, reduced corruption, and ensured the timely delivery of inputs.
Similarly, Nigeria’s Growth Enhancement Support Scheme (GESS) replaced the previous corrupt and inefficient system with an e-wallet system. Farmers receive input vouchers via mobile phones, which they can use to purchase subsidised inputs from registered agro-dealers.
Zimbabwe’s integrated credit card system is expected to be rolled out soon and will build on these successes.
Source: allAfrica
Image Credit: Ethiopian News Agency
