MICROFINANCE PAPER WRAP-UP: “COVID-19: Accelerating the Use of Digital Agriculture;” by Leslie Arathoon, Rishi Raithatha, Daniele Tricarico; Published by GSMA

This report offers a review of prior findings on trends and best practices in “digital agriculture” services provided by mobile network operators (MNOs) and dedicated agricultural technology (agritech) companies. Digital agriculture can include a range of online tools for facilitating the usage of various types of information at any point along agricultural supply chains.

Attempts to quell the spread of COVID-19, including lockdowns and limits on gatherings, have had a deeply negative impact on the agricultural sector, especially in low- and middle-income countries (LMICs). This is exacerbating extreme poverty and food insecurity due to “declining incomes and disruptions to the food supply.” In addition, recent successes in assisting female smallholder farmers – through means such as equalizing access to financial services and creating “digital identities” – may be disrupted, thereby widening the gender gap. Agribusinesses also have had difficulty adapting to COVID-19 measures, resulting in trouble recruiting farmers and providing cash payments to those with whom they already work.

Since the onset of COVID-19, the authors find: 1) most companies increasing digitization during the pandemic used pre-existing tools rather than introducing new digital tools; 2) smallholder farmers are using mobile money more regularly due to governments lowering the barriers to using digital channels and also disbursing relief funds through such channels; and 3) “governments, donors and agritech companies” are more focused on helping link smallholder farmers with buyers, although the challenge of transportation to deliver crops to buyers has become greater during the pandemic.

Despite certain successes, the authors note four obstacles to increasing the adoption of digital agriculture since the pandemic began: 1) reduced access to technology both in terms of the ability to buy a mobile device and to purchase units of data; 2) the widening gender gap in the usage of digital agriculture; 3) misinformation spreading via social media; and 4) decreased profitability of mobile money providers due to “the elimination of fees [which was imposed by multiple governments] and lower transaction values.”

Going forward, the authors suggest agritech companies: 1) engage with entities supporting the agricultural sector in LMICs, such as the World Bank; 2) partner with organizations that have “complementary assets” to facilitate the introduction of new offerings; and 3) distribute agricultural advisory services via short message service (SMS, also known as text messaging) or offline applications, which are more accessible to users and less susceptible to misinformation than are web-based platforms such as Facebook.

Lastly, the authors argue that investors, donors and multilateral organizations: 1) ensure there is a base of people to utilize a potential technology before an investment is made; (2) focus on providing “a full range of solutions via a single platform” rather than zeroing in on one specific issue; and 3) address difficulties that women in particular are facing during the pandemic to prevent the loss of gains they have made over the last decade.

This is a summary of a paper by Leslie Arathoon, Rishi Raithatha and Daniele Tricarico; published by the Global System for Mobile Communications Association (GSMA); April 2021; 80 pages; available at https://www.gsma.com/mobilefordevelopment/wp-content/uploads/2021/04/COVID_19_Accelerating_the_use_of_digital_agriculture_updated.pdf

By Bradley Shulman, Research Associate

Additional Resources

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