Over 100,000 smallholder farmers received personalised financial services from a smart funding initiative of Social Lender, a fintech company, and OCP Africa, a fertilizer company.
More than 60 per cent of smallholder farmers in Nigeria do not have Bank Verification Number (BVN) and are currently unbanked or under-banked. The absence of BVN is one of many indicators of financial exclusion. This has led to widening economic exclusion and poverty among farmers and others.
To alleviate this problem, Social Lender has collaborated with OCP Africa to bring financial services to many Nigerians. The Country Manager, OCP Africa Fertilizers Nigeria, Caleb Usoh, said that the aim of the partnership “is to ensure financial inclusion of a larger percentage of smallholder farmers in the country through BVN registrations and financial literacy training.”
According to him, the collaborative effort would alleviate the suffering of the people and help them to improve their lives. He added that the collaboration with Social Lender would help to prepare the farmers to gain access to competitive financial services provided by top institutions in Nigeria and beyond while improving their livelihood.
Explaining how the partnership was formed with Social Lender, Usoh said the company emerged as one of the winners of the prized grant of the OCP-supported Impulse Start-up Accelerator challenge fund programme.
“This has boosted the partnership and is reflected in the increased number of beneficiaries who have accessed the services on offer,” he said.
The partnership would allow Social Lender to leverage OCP Africa’s existing 51 retail input distribution hubs called the One Stop Shop, which is spread across rural farming communities in Nigeria.
Social Lender would provide several services to the farmers, which include a series of financial literacy training, financial inclusion through the creation of BVN accounts, mobile money and credit profiling as well as helping the farmers to obtain small scale loans.
The Chief Executive Officer of Social Lender, Faith Adesemowo, reiterated the importance of the partnership by inviting other organisations interested in serving the huge market segment to collaborate with Social Lender. She informed that her company “is currently building a low-cost distribution infrastructure” model needed to serve the unbanked and underbanked.
“We are building an innovative solution to serve this market effectively. The Social Reputation score is our main asset. For the offline market, we have started with a pilot in 2018 with CGAP, a division of the World Bank. Working with EFINA, we have scaled to six states including two Northern states. With OCP Africa partnership, we will add 31 locations and cover 14 states,” she said.
Adesemowo said the company is a fintech that works across all industries. “We have just chosen to have a strategic focus in agriculture since a large number of the financially excluded are a part of this demography. Social Lender may someday become a full agritech but for now, we are fintech working in agriculture,” she said.
The Chief Operating Officer of Social Lender, Mudiaga Ogboru, said that partnership with OCP has further unlocked the value in the agricultural value chain, as more farmers have gained access to formal financial services like agro-loans, equipment leasing financing, fertilizer on credit, quality seeds and other agro-necessity.
“We are building a network for trust, credit and much more. For us, financial literacy is the bedrock for financial inclusion and economic inclusion. We have built a robust financial literacy curriculum that is sufficiently equipped and digestible to the farmers because it is communicated in a language that is most comfortable for the farmers,” he said.
Many farmers have already benefited from the partnership. One of them, Jibril Mansur, from Kaduna, lauded the initiative. He has joined the financial ecosystem programme because it was brought to his community.
Hajiya Aisha, another beneficiary from Kano expressed how the opportunity has changed her life. She is currently gradually being upgraded from an unbanked customer with no bank account, BVN, and access to credit into the formal financial system. “This is a level 10 on Social Lender’s digital financial inclusion journey,” Ogboru explained.