In a significant step towards enhancing financial inclusion, particularly for smallholder farmers in Mozambique, the International Finance Corporation (IFC) has inked a collaboration agreement with Vodafone M-PESA Mozambique. This partnership aims to leverage the power of mobile money services to reach rural areas and uplift the agricultural sector, a critical component of Mozambique’s economy.
Key Collaborative Initiatives:
The partnership between IFC and M-PESA Mozambique will focus on various key initiatives to strengthen and expand mobile money services:
- Agent Network Revamp: IFC will support M-PESA in revamping and strengthening its existing agent network, laying the groundwork for improved accessibility to mobile money services.
- Comprehensive Training: IFC will conduct comprehensive countrywide training for M-PESA’s sales team and agents, ensuring a well-equipped workforce capable of delivering efficient and effective services.
- Merchant Acquisition Strategy: The collaboration aims to review and expand M-PESA’s merchant acquisition and management strategy in Mozambique, facilitating increased acceptance and usage of mobile money for various transactions.
- Rural Expansion: IFC and M-PESA will work together to explore and pilot innovative approaches to expand mobile money services in rural areas. The primary goal is to enhance financial inclusion for smallholder farmers, who play a pivotal role in Mozambique’s agricultural production.
Addressing Financial Inclusion Challenges:
Mozambique faces challenges in achieving widespread financial inclusion, with only about forty percent of adults currently having a mobile money account, falling short of the regional average of 64 percent. The collaboration seeks to bridge this gap, providing Mozambican customers with a secure, affordable, and efficient means to engage in financial transactions such as sending and receiving money, topping up airtime, making bill payments, receiving salaries, and accessing short-term loans.
Positive Outcomes from Previous Collaboration:
The agreement builds upon a successful initial collaboration between IFC and M-PESA Mozambique. Over the four-year period from 2018 to 2022, the number of active registered M-PESA users in Mozambique tripled from 1.9 million to an impressive 6 million. Sergio Gomes, Director of Vodafone M-PESA Mozambique, highlighted the positive impact and expressed a strategic focus on expanding M-PESA’s value proposition, especially in agriculture.
Empowering Agriculture Through Digitization:
The collaboration recognizes the significant role of smallholder farmers, who contribute to 93 percent of Mozambique’s total agricultural production. M-PESA Mozambique aims to digitize value chains in agriculture, starting with payments for produce and extending to the development of more sophisticated products like insurance.
Mutual Commitment to Inclusive Finance:
Sérgio Pimenta, Vice President for Africa at IFC, emphasized the mutual commitment shared by IFC and M-PESA Mozambique in fostering a more inclusive financial ecosystem. The partnership’s strategic focus on supporting the growth of the agricultural sector, particularly for smallholder farmers, is deemed crucial for the country’s overall economic development.
Conclusion:
The collaboration between IFC and Vodafone M-PESA Mozambique represents a significant stride towards advancing financial inclusion and digitizing financial services in Mozambique. By harnessing the potential of mobile money, especially in rural areas and the agricultural sector, the partnership aims to create lasting positive impacts on the country’s economy.
