FEATURED: How MoneyPhone Africa Ltd empowers underserved MSMEs, smallholder farmers

MoneyPhone, a Dutch-Rwandan fintech company founded in 2018, is transforming access to finance for micro, small, and medium enterprises (MSMEs) and smallholder farmers who have long been excluded from conventional banking systems. The company’s innovative approach provides digital loans that are fast, affordable, and accessible, aiming to bridge the financial gap for underserved groups and make financial services more inclusive. Bridging the agricultural finance gap in Rwanda Agriculture is the backbone of Rwanda’s economy, yet only 7% of bank lending goes to the agricultural sector, leaving many farmers struggling to access the financial services necessary for growth. Since its entry into the Rwandan market in 2019 as a Software-as-a-Service (SaaS) provider, MoneyPhone has evolved significantly. In 2023, it became a licensed non-deposit-taking financial institution under the Central Bank of Rwanda, transitioning into a mobile-accessible digital lending platform. MoneyPhone’s impact is particularly significant in unlocking financial access for smallholder farmers. By leveraging AI, algorithms, and data analysis through its globally operating software systems, MoneyPhone ensures loans are personalized and timely, providing farmers with the right financial solutions based on their needs and circumstances. This advanced technology also helps in promoting financial and digital literacy among rural communities, fostering both financial inclusion and improved farming practices. Impactful partnerships: The case of ‘Hirwa 35’ cooperative One example of MoneyPhone’s success is the partnership with the ‘Hirwa 35’ cooperative, a group of 577 maize and chili pepper farmers in the Nzige Sector of Rwamagana District. Working with MoneyPhone since April 2024, the cooperative has seen significant improvements in farming activities. Members, including 349 women and 228 men, can now plant on time, purchase essential agricultural tools, and meet other needs without the financial strain they previously faced. This has led to enhanced productivity and improved livelihoods. Fast, accessible loans with lower interest rates Marthe Paauwe, CEO of MoneyPhone, explained that loans are disbursed through cooperatives, ensuring a quick and efficient process. Farmers can apply for loans via their phones without having to travel to traditional banks or microfinance institution branches. Once approved, the money is sent directly to their phones within one week. We offer loans that are tailored to match the seasonal needs of farmers, Paauwe said. “These loans enable farmers to pay for labour, maintain equipment, and purchase quality seeds, fertilisers, and organic pesticides. With increased productivity and sales, farmers can reinvest profits into their households, buy additional land, pay school fees, or invest in value-added businesses.” MoneyPhone currently collaborates with cooperatives and market players focused on crops like Irish potatoes, tea, beans, chili peppers, French beans, and carrots. “We are expanding our value chains, adding maize this year, and introducing more digital loan products, such as clean cooking stoves and SME solutions,” adds Paauwe. AI-driven insights for tailored solutions MoneyPhone’s use of AI, algorithms, and global data analytics is crucial in identifying the unique needs of farmers. By analysing data from various sources, MoneyPhone can predict seasonal trends, assess creditworthiness, and provide timely, customized financial solutions that match each farmer’s specific circumstances. This technology significantly reduces the waiting time for loan approvals, ensuring farmers receive support when they need it most. Understanding local needs Jean-Paul Mushumba, Country Director of MoneyPhone, highlights the importance of understanding the unique challenges Rwandan farmers face. “Farmers rely heavily on seasonal crops, so they must capitalise during good seasons. Traditional financial institutions can take three to four months to process loans, which is often too late,” he explains. “By reducing the waiting time to just two or three days, MoneyPhone ensures farmers access funds quickly, anytime and anywhere.” Beyond loans, MoneyPhone provides farmers with financial expertise. Agricultural financial experts train farmers in money management and financial literacy, ensuring the effective use of funds. They also educate farmers on crop insurance to protect against potential losses. Farmers’ perspectives Farmers working with MoneyPhone share positive feedback about the impact of the loans. Charles Nyandwi, a 32-year-old member of the Hirwa 35 cooperative, used his Rwf500,000 loan to buy a pumping machine, pay labourers, and insure his crops. “I’ll harvest around 20 tonnes per hectare and sell them at Rwf700 per kilogram. This will allow me to repay the loan and reinvest the remaining money for the next season,” Nyandwi explains. He expresses satisfaction with the timely support, noting, “The money comes at the right time. I’m assured of a strong partnership with MoneyPhone.” Ernestine Hakizimana, a mother of two, says previous experiences with other banks were discouraging due to high interest rates and lengthy approval times. “With MoneyPhone, you only need to be a member of a cooperative. The digital application is simple and can be filled out on your phone. After receiving the money within a few days, we expanded our cultivation and improved our methods, leading to higher yields.” Empowering women and youth MoneyPhone’s innovative, data-driven approach promotes financial inclusion by removing barriers such as traditional collateral, which often limits women and youth from accessing loans. The digital loan process, accessible via mobile phones, allows women to manage funds while balancing household responsibilities. Youth also benefit from independent access to funds without relying on traditional banking or household norms. Collaborations and global presence MoneyPhone partners with key players in Rwanda’s agricultural and economic development space, including RCA, AFR, AGRA, RTI, RVO, SNV, EKN, Invest International and SPARK. Beyond Rwanda, MoneyPhone is active in seven countries, offering 11 digital loan products tailored to the specific needs of each market. The company’s use of AI and data-driven insights enables it to adapt and deliver impactful solutions in diverse markets, reinforcing its global mission of financial inclusion. Visit our website here

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FEATURED: How MoneyPhone Africa Ltd empowers underserved MSMEs, smallholder farmers