shapshot results from tanzania, kenya & zambia · 2018. 5. 29. · economic profile (2) ... sold...
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Leesa Shrader
COMPARATIVE ANALYSIS OF SMALLHOLDER FARMERS IN KENYA, ZAMBIA AND TANZANIA
Shapshot results from Tanzania, Kenya & Zambia
AFA Program Director
Washington DC, May 2018
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2
Background: AFA Program Objectives
Financial Inclusion and Climate Resilience Roundtable
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3
Products & Services for SHF
Last Mile Distribution
Farmer Capability Tools
Technology Start Up Acceleration
Alternative Data & Credit Scoring
AFA Approach: Innovation PartnerFinancial Inclusion and Climate Resilience Roundtable
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AFA Approach: Outcomes & ImpactFinancial Inclusion and Climate Resilience Roundtable
We expect to see 50% increases in income and productivity for farmers,
with 50% outreach to women
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6
Research Question 1: What is the profile of an average farmer in Tanzania, Kenya and Zambia?
Socio-economic profile:
• Kenya’s SHFs have the largest income gender gap both in total and relative terms.
• Zambia’s SHFs education income gap is most pronounced: the median SHF with tertiary education earns $121, while the median SHF with no formal education or primary education only earns $9 or $12 a month.
$40
$69
$121*
$22
$35
$22
$19
$22
$12
$15
$13
$9
Tanzania
Kenya
Zambia
Median Monthly total income by education and country
No Formal Education Primary
Secondary Tertiary
*Income levels might be skewed due to a small sample size in the tertiary category.
3.1 Profile of Smallholder Farmers
$22
$38
$18
$16
$20
$14
0 10 20 30 40
Tanzania
Kenya
Zambia
Median Monthly total income by gender and country
Female Male
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7
Research Question 1: What is the profile of an average (or median) farmer in Tanzania, Kenya and Zambia?
Economic Profile (2) – income distribution of SHFs:
• Income distributions in all three countries point towards a large share of SHFs living below $1/day.
• Zambia observes the most unequal distribution: while it has overall fewer SHFs living below $2 /day than Tanzania, 48% of Zambian farmers still live below $0.5/day.
43%
24%
12%
5%
4%
6%
2%
4%
Below $0.5/day
$0.5-1/day
$1-1.5/day
$1.5-2/day
$2-2.5/day
$2.5-4/day
$4-6/day
Above $6/day
Tanzania
37%
16%
9%
7%
4%
9%
7%
11%
Kenya
48%
16%
7%
4%
4%
7%
5%
11%
Zambia
84% < $2 / day 69% < $2 / day 75% < $2 / day
Disclaimer: Note that comparing SHF’s average income does not account for national differences in income levels. We can however interpret the income distribution for each country.
3.1 Profile of Smallholder Farmers
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8
Research Question 2: What is the uptake and usage of financial services by SHFs in Tanzania, Kenya and Zambia?
Nature of Financial Uptake:
• Kenya’s SHFs have the highest financial inclusion levels with only 9% who are excluded.
• Of those who are financially included in Kenya, 33% are banked as opposed to 16% in Zambia and 7% in Tanzania.
• Mobile money penetration is 56% in Kenya, while it is lowest in Zambia (16%) and 41% in Tanzania.
3.2 Uptake and Usage of Financial Services
7%
33%
16%
41%
56%
16%
7%
2%
2%
9%
4%
36%
9%
62%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Tanzania
Kenya
Zambia
% of Financial service uptake
Banked Mobile Money Other Formal Informal Excluded
Base: All SHFs
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9
Research Question 2: What is the uptake and usage of financial services by SHFs in Tanzania, Kenya and Zambia?
Nature of Financial Uptake:
• SHFs in Tanzania make most use of informal services and are catching-up with insurance and mobile money.
• 91% of Kenyan SHFs are formally included. Kenya has the highest take up across most types of financial services, except informal services and MFIs.
55%48%
30%
15%7%
2% 1%
91%87%
5%
27%33%
3%10%
34%
26%
6%2%
16%
6% 3%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Formal Mobile Money Informal Insurance Banked MFI SACCO
Financial service uptake by type of service
Tanzania Kenya Zambia
3.2 Uptake and Usage of Financial Services
Base: All SHFs
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10
Mobile money services uptake by age:
• In Kenya, mobile money uptake is similar for SHFs between 16 and 54 but decreases in groups older than this.
• In Tanzania, mobile money uptake is bell-shaped with low values for the youngest and oldest SHF segments, peaking for SHFs between 45 and 54.
• In Zambia, SHFs of all age groups have similar mobile money uptake.
Research Question 2: What is the uptake and usage of financial services by SHFs in Tanzania, Kenya and Zambia?
3.2 Uptake and Usage of Financial Services
42%
91%
22%
50%
90%
30%
54%
88%
23%
56%
90%
29%
43%
85%
23%28%
74%
27%
0%
20%
40%
60%
80%
100%
Tanzania Kenya Zambia
Perc
en
tag
e
% of Population Using Mobie Money by Age Group
Age 16 to 24 Age 25 to 34 Age 35 to 44 Age 45 to 54 Age 55 to 65 Above 65
Base: All SHFs
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11
42%
58%
No
Yes
Saving behaviour - Kenya
Saving behaviour: Kenyan SHFs who save (58%) often do so by using mobile money (41% use KCB M-Pesa, 15% use MPesa and 12% use M-shwari). Savings groups are also used frequently (33%) and most SHFs have moved away from savings at home (‘savings in a hidden place’ = 1.2%).
Base: SHFs who save
41%
33%
15%
12%
8%
6%
5%
5%
5%
4%
3%
3%
2%
1.3%
1.3%
1.2%
1.2%
1%
0% 10% 20% 30% 40% 50%
KCB M-Pesa Account
Farmers’ savings and loan group
M-pesa
M-shwari
Co-operative SACCO
M-Co-op Cash
Friend/family to guard against…
Co-operative Bank
Formal SACCO
Equitel
Others
Chama
Friends in rotating ROSCA
Church SACCO
Microfinance Bank
Equity Bank
Savings in a hidden place
Family bank pesa pap
Saving channels used by SHFs - Kenya
3.2 Uptake and Usage of Financial Services
Research Question 3: How do SHFs save and borrow in Tanzania, Kenya and Zambia?
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12
77%
23%
No
Yes
Borrowing behaviour -Kenya
Borrowing behaviour: SHFs in Kenya borrow are less likely to borrow than those in Tanzania (23% vs 45%). Those that do have mostly moved away from borrowing from friends or neighbour (5%) and are using informal groups, such as Chama (30%) or SACCOs (14%), or mobile money services such as Mshwari (20%).
30%
20%
16%
14%
8%
5%
2%
2%
1%
1%
1%
0.4%
0.5%
0.2%
0.2%
0% 5% 10% 15% 20% 25% 30% 35%
Chama
Mshwari
Bank
Sacco
Microfinance
Family/Friends/Neighbor
Agricultural Input Supplier
Kcb M –Pesa
Buyer Of Your Produce…
Money Lender
Local Trader
Government Institution
Mobile Phone Downloaded…
Employer
Hire Purchase
Borrowing channels used by SHFs - Kenya
3.2 Uptake and Usage of Financial Services
Base: SHFs who borrow
Research Question 3: How do SHFs save and borrow in Tanzania, Kenya and Zambia?
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13
57%
43%
No
Yes
Saving behaviour - Zambia
Saving behaviour: The most common way of saving for SHFs in Zambia is savings money in a hidden place, e.g. at home (40% of SHFs who save). Mobile money uptake for saving purposes is relatively high (12%), considering the overall low uptake of 26% across SHFs in Zambia.
40%
19%
12%
11%
12%
10%
4%
4%
2%
3%
2%
0% 10% 20% 30% 40% 50%
Savings in a hidden place
Others
Mobile money
Xapit account
Microfinance Bank
Ichilimba
Farmers’ savings and loan group
Co-operative SACCO
A group of friends in rotating…
A friend/family to guard…
Zoona Sunga
Saving channels used by SHFs - Zambia
3.2 Uptake and Usage of Financial Services
Base: SHFs who save
Research Question 3: How do SHFs save and borrow in Tanzania, Kenya and Zambia?
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14
87%
13%
No
Yes
Borrowing behaviour -Zambia
Borrowing behaviour: Only a small proportion of SHFs in Zambia claim that they borrow money. Of those who do, 33% do not indicate a source and 32% borrow from family and friends.
33%
32%
11%
8%
4%
4%
4%
4%
0% 5% 10% 15% 20% 25% 30% 35%
None
Family/Friends/Neighbor
Bank
Microfinance
Government Institution
SACCO
Ichilimba
Money Lender
Borrowing channels used by SHFs - Zambia
3.2 Uptake and Usage of Financial Services
Base: SHFs who borrow
Research Question 3: How do SHFs save and borrow in Tanzania, Kenya and Zambia?
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15
Research Question 5: What is the uptake and usage of digital financial services in Tanzania, Kenya and Zambia?
3.3 Digital Services
55%
90%
30%39%
85%
21%
0%
20%
40%
60%
80%
100%
Tanzania Kenya Zambia
SHF using mobile money by gender
Male Female
Mobile money uptake:
• Mobile money uptake varies in in each country, underlining their different progress in terms of market evolution.
• Although the gender gap is closing in mobile money in Kenya, it remains significant in Tanzania and Zambia.
48%
87%
26%
0%
20%
40%
60%
80%
100%
Tanzania Kenya Zambia
SHFs using mobile money
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16
98% 98%
78% 76%67%
57%
32% 30%20%
13% 13% 11% 10%8%
95% 96%
11%
69%
7%
31%
5% 5% 11% 7% 10% 7% 6% 6%0%
20%
40%
60%
80%
100%
Rec
eiv
e ca
lls
Mak
e ca
lls
Wit
hd
raw
mo
ney
Sen
d/
rece
ive
tex
t m
essa
ges
Dep
osi
t m
on
ey
Bu
y a
irti
me
top
-up
s
Rec
eiv
e p
aym
ents
Mak
e p
aym
ents
Acc
ess
Info
rmat
ion
Use
/b
row
se t
he
inte
rnet
Sen
d/
rece
ive
ph
oto
mes
sag
es(M
MS
)
Fac
e b
oo
k
Wh
ats
Ap
p
Do
wn
load
mu
sic,
vid
eo o
rg
ames
SHFs using mobile phone for different purposes
Kenya Zambia
5 Annex
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17
25%
22%
14%
14%
11%
8%
3%
3%
1%
0%
0% 5% 10% 15% 20% 25% 30%
Nothing
Worked more
Sold agriproducts
Cut down on expenses
Used savings
Others
Borrowed money
Sold asset
Sold an asset
Claimed insurance
Remittance
Agricultural Events - Tanzania
• About half of all SHFs have experienced unexpected agricultural events in the past 12 months.
• For 75% of those the event has a significant effect on household income, urging to either use-up savings, reduce consumption or do additional work to make-up for the loss.
• No insurance is used and only few SHFs uptake cash savings.
47%
36%
Harvest/crop failure/loss oflivestock
Loss of income as a result ofan unexpected drop in the
price you get forproduce/harvest/ products
you sell
Percentage of SHFs that suffer from agricultural shocks (1)
Coping mechanisms for SHFs that experience crop failure (2)
Research Question 7: What do farmers perceive as the most serious threat to their livelihoods? What are the coping strategies?
Base for chart 1 is all SHFs in Tanzania. For chart 2, it is SHFs who experience crop failures.
3.5 Growth and Resilience
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18
Where We Are Today: Models to a Million
Six existing core partners can be linked to ADF program in Tanzania and Kenya: Safaricom, Equity Bank, WFP FtMA, NMB, CRDB and Halotel/FINCA Bank + 20 VAS partners
Financial Inclusion and Climate Resilience Roundtable
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Thank You!
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