How Releaf and OnePipe plan to help farmers in Southern Nigeria have access to digital financial services
How Releaf and OnePipe Plan to help Farmers in Southern Nigeria
Farmers in Cross River and Akwa Ibom states can now easily access digital financial services thanks to a partnership between Releaf, an agritech startup, and OnePipe, a fintech startup.
Uzoma Ayogu, co-founder and chief technology officer of Releaf, commented on the partnership, "Since inception, Releaf has empowered over 1,000 farmers to supply over 10 million kilograms of high-quality crops to various food factories."
While we have traditionally paid our farmers in cash, we now have access to digitised fund disbursement via embedded, customized accounts provisioned by OnePipe, enabling previously financially excluded farmers to participate in the digital economy.”
Additionally, he revealed that Releaf is exploring the possibility of providing insurance services through the use of OnePipe's infrastructure and partnerships. The partnership provides farmers with an embedded account dubbed Releaf Wallet, which can be accessed and used via USSD and Progressive Web Apps (PWA) channels.
Farmers can withdraw money from any bank/channel, transfer funds to any Nigerian bank account, and purchase airtime for themselves or third parties using these accounts.
As is the case with the majority of digital finance services, they can also access loans, with loan amounts increasing in proportion to their wallet usage.
According to Ope Adeoye, Founder and Chief Plumber of OnePipe, "collaborating with Releaf was inevitable because the company's vision to transform Africa's agricultural future by scaling decentralized food processing aligns with OnePipe's social mandate to accelerate financial inclusion for all — including the continent's 700 million+ smallholder farmers."
According to data from the Nigeria Inter-Bank Settlement System Plc (NIBSS), 48 million Nigerians had a BVN as of May 30, 2021. With a total adult population of 105 million in Nigeria, according to the World Population Review, this equates to 57 million unbanked Nigerians.
While fintech startups have sprung up in an attempt to connect more Nigerians to financial services, they have primarily addressed issues associated with existing financial services.
According to research, poverty, a lack of education, and rural residence — all of which are characteristics of the average Nigerian smallholder farmer — are impediments to financial inclusion.
Partnership
The partnership between Releaf and OnePipe is a positive development that follows the playbook of Asia's super apps.
The majority of farmers with whom Releaf works are smallholder farmers who live in rural areas. By enabling them to access financial services via digital channels, they can establish a digital footprint that enables them to access additional financial services, thereby accelerating their financial inclusion.
However, it is unclear whether this service is available to farmers who are not part of Releaf's network.
Releaf was originally an online marketplace that connected buyers and sellers of agricultural commodities with trustworthy customers, founded in 2017 by Isaiah Udotong, Ikenna Nzewi, and Uzoma Ayogu.
In 2017, the startup was accepted into Y Combinator and received a $120,000 investment. After returning to Nigeria, the founders continued to provide a market for agricultural commodities until they noticed that food manufacturers were having difficulty obtaining raw materials for their operations.
In Conclusion
This resulted in a shift in focus, with the startup now operating as a raw materials procurement and logistics platform focused on oil palm.
Through this partnership with OnePipe, it is anticipated that smallholder farmers in Nigeria, the majority of whom lack access to financial services, will now be able to access financial services, thereby contributing to the country's financial inclusion goals.
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