Shapshot results from Tanzania, Kenya & Zambia

Transcription

1 COMPARATIVE ANALYSIS OF SMALLHOLDER FARMERS IN KENYA, ZAMBIA AND TANZANIA Shapshot results from Tanzania, Kenya & Zambia Leesa Shrader AFA Program Director Washington DC, May 2018

2 Financial Inclusion and Climate Resilience Roundtable Background: AFA Program Objectives 2

3 Financial Inclusion and Climate Resilience Roundtable AFA Approach: Innovation Partner Products & Services for SHF Last Mile Distribution Farmer Capability Tools Technology Start Up Acceleration Alternative Data & Credit Scoring 3

4 Financial Inclusion and Climate Resilience Roundtable AFA Approach: Outcomes & Impact We expect to see 50% increases in income and productivity for farmers, with 50% outreach to women

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6 3.1 Profile of Smallholder Farmers 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. Zambia Median Monthly total income by gender and country $14 $18 Zambia Median Monthly total income by education and country $9 $12 $22 $121* Kenya $20 $38 Kenya $13 $22 $35 $69 Tanzania $16 $22 Tanzania $15 $19 $22 $ Female Male No Formal Education Secondary Primary Tertiary *Income levels might be skewed due to a small sample size in the tertiary category. 6

7 3.1 Profile of Smallholder Farmers 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. Tanzania Kenya Zambia Above $6/day 11 % 11% $4-6/day 2% 7% 5% $2.5-4/day 6% 9% 7% $2-2.5/day $1.5-2/day 5% 7% $1-1.5/day 12% 9% 7% $0.5-1/day % % Below $0.5/day 37 43% % 8 < $2 / day 69% < $2 / day 75% < $2 / day 48% 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. 7

8 3.2 Uptake and Usage of Financial Services 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. % of Financial service uptake Zambia 16% 16% 2% 62% Kenya 33% 56% 2% 9% Tanzania 7% 41% 7% 9% 36% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Banked Mobile Money Other Formal Informal Excluded Base: All SHFs 8

9 3.2 Uptake and Usage of Financial Services 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. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 55% 91% 3 48% 87% Financial service uptake by type of service 26% 30% 5% 6% 15% 27% 2% 7% 33% 16% 10% 2% 3% 6% 1% 3% Formal Mobile Money Informal Insurance Banked MFI SACCO Tanzania Kenya Zambia Base: All SHFs 9

10 Percentage 3.2 Uptake and Usage of Financial Services Research Question 2: What is the uptake and usage of financial services by SHFs in Tanzania, Kenya and Zambia? 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. % of Population Using Mobie Money by Age Group 100% 91% 90% 88% 90% 85% 80% 7 60% 40% 20% 42% 50% 5 56% 43% 28% 22% 30% 23% 29% 23% 27% 0% Tanzania Kenya Zambia 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 10

11 3.2 Uptake and Usage of Financial Services Research Question 3: How do SHFs save and borrow in Tanzania, Kenya and Zambia? 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%). Saving channels used by SHFs - Kenya Yes No Saving behaviour - Kenya 42% 58% Family bank pesa pap Savings in a hidden place Equity Bank Microfinance Bank Church SACCO Friends in rotating ROSCA Chama Others Equitel Formal SACCO Co-operative Bank Friend/family to guard against M-Co-op Cash Co-operative SACCO M-shwari M-pesa Farmers savings and loan group KCB M-Pesa Account 1% 1.2% 1.2% 1.3% 1.3% 2% 3% 3% 5% 5% 5% 6% 8% 12% 15% 33% 41% 0% 10% 20% 30% 40% 50% Base: SHFs who save 11

12 3.2 Uptake and Usage of Financial Services Research Question 3: How do SHFs save and borrow in Tanzania, Kenya and Zambia? 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 (1), or mobile money services such as Mshwari (20%). Borrowing channels used by SHFs - Kenya Yes No Borrowing behaviour - Kenya 23% 77% Hire Purchase Employer Mobile Phone Downloaded Government Institution Local Trader Money Lender Buyer Of Your Produce Kcb M Pesa Agricultural Input Supplier Family/Friends/Neighbor Microfinance Sacco Bank Mshwari Chama 0.2% 0.2% 0.5% 0. 1% 1% 1% 2% 2% 5% 8% 1 16% 20% 30% 0% 5% 10% 15% 20% 25% 30% 35% Base: SHFs who borrow 12

13 3.2 Uptake and Usage of Financial Services Research Question 3: How do SHFs save and borrow in Tanzania, Kenya and 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. Saving behaviour - Zambia Saving channels used by SHFs - Zambia Yes No 43% 57% Zoona Sunga A friend/family to guard A group of friends in rotating Co-operative SACCO Farmers savings and loan group Ichilimba Microfinance Bank Xapit account Mobile money Others Savings in a hidden place 2% 3% 2% 10% 12% 11% 12% 19% 40% 0% 10% 20% 30% 40% 50% Base: SHFs who save 13

14 3.2 Uptake and Usage of Financial Services Research Question 3: How do SHFs save and borrow in Tanzania, Kenya and 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. Borrowing channels used by SHFs - Zambia Money Lender Borrowing behaviour - Zambia Ichilimba SACCO Yes 13% Government Institution Microfinance 8% Bank 11% No 87% Family/Friends/Neighbor 32% None 33% 0% 5% 10% 15% 20% 25% 30% 35% Base: SHFs who borrow 14

15 3.3 Digital Services Research Question 5: What is the uptake and usage of digital financial services in Tanzania, Kenya and Zambia? 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. SHFs using mobile money SHF using mobile money by gender 100% 80% 87% 100% 80% 60% 48% 60% 40% 20% 0% 26% Tanzania Kenya Zambia 40% 20% 0% 90% 85% 55% 39% 30% 21% Tanzania Kenya Zambia Male Female 15

16 Receive calls Make calls Withdraw money Send/receive text messages Deposit money Buy airtime top-ups Receive payments Make payments Access Information Use/browse the internet Send/receive photo messages (MMS) Face book Whats App Download music, video or games 5 Annex SHFs using mobile phone for different purposes 100% 80% 60% 98% 98% 95% 96% 78% 76% 67% 69% 57% 40% 31% 32% 30% 20% 13% 13% 11% 10% 20% 0% 11% 7% 5% 5% 11% 7% 10% 7% 6% 8% 6% Kenya Zambia 16

17 3.5 Growth and Resilience Research Question 7: What do farmers perceive as the most serious threat to their livelihoods? What are the coping strategies? 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 useup savings, reduce consumption or do additional work to make-up for the loss. No insurance is used and only few SHFs uptake cash savings. Percentage of SHFs that suffer from agricultural shocks (1) Coping mechanisms for SHFs that experience crop failure (2) 47% Claimed insurance 0% 36% Sold an asset Sold asset Borrowed money 1% 3% 3% Remittance Others 8% Harvest/crop failure/loss of livestock Loss of income as a result of an unexpected drop in the price you get for produce/harvest/ products you sell Base for chart 1 is all SHFs in Tanzania. For chart 2, it is SHFs who experience crop failures. Used savings Cut down on expenses Sold agriproducts Worked more Nothing 11% % 25% 0% 5% 10% 15% 20% 25% 30% 17

18 Financial Inclusion and Climate Resilience Roundtable 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 18

19 Thank You!