Mobile network operators have much to gain from agriculture

Ghana's six mobile network operators have been slow to take advantage of agricultural value chains in the promotion of mobile services.

Ghana’s six mobile network operators have been slow to take advantage of agricultural value chains in the provision of mobile services.

Visit Ghana and ask for the phone number of any ordinary person on the street, and most likely you’ll be given the option of two or three different mobile network operators (MNOs) to choose from. Ghana has 19 million cell phone subscribers for its over 24 million inhabitants — an impressive proportion — most of whom subscribe to more than one operator.

Ghana is one of Africa’s most vibrant and innovative communications markets. It launched the first cellular mobile network in sub-Saharan Africa in 1992, and was one of the first countries on the continent to be connected to the Internet and introduce ADSL services. A market leader in terms of liberalization and deregulation, Ghana Telecom in 1996.

Ghana is serviced by six MNOs, including: Scancom (MTN) with 50% of the market share; Millicom (Tigo), 21%; Vodafone Mobile, 18%; Bharti Airtel, 10%; and Expresso and Glo, the most recent additions with the smallest market shares.

In mid-2010 the voice market reached more than 70% penetration, but huge potential still exists for the 3G broadband services that were launched in 2009.

Mobile services

In terms of economic impact, the telecoms sector has contributed significantly to the country’s increase in GDP over the past twenty years and there is still massive room for growth. The question, then, is how many of these businesses have ever rolled out an innovation to support agriculture?

Value-added services such as mobile money have created jobs in the telecommunications and banking sectors as well as for the more than 4000 merchants in Ghana’s mobile money system. MTN’s Mobile Money was the first mobile or branchless banking  initiative in the country and operates in partnership with nine of Ghana’s banks. They currently have more than two million active users and MTN expects this number to grow through the education of subscribers on the benefits of switching from cash payments to electronic ones.

But outreach activities rarely address the needs of our smallholder farmers. Is it because MNOs consider farmers to be poor to use the services, or perhaps not sufficiently savvy on Information and Communication Technologies (ICTs)?

Operator Risks

Risks factors for mobile banking operators come in the form of strategic, reputational, compliance and operational risks. Operators need to keep a close eye on their outsourced providers, ensuring their activities are consistent with the overall strategic goals of the regulated entity — a task that may not be easy in the isolated, rural areas where most of our smallholders are located.

The same is true of reputational threats, which come in the form of poor service via third-party agents or consumer experiences that are inconsistent with the overall standards of the operator. Operators may have difficulties with ensuring that privacy, consumer and prudential laws are complied with at all times.

Operational risks are usually the biggest risk to operators. Technology failure, human error, cyber fraud, agent fraud, insecurity and unreliability of services and lack of customer education are just a number of factors that put operators at risk when lending their services to all users, smallholder farmers included.

Operator benefits and Africa’s booming mobile market

With so many potential risks, what are the incentives for getting involved in mobile services?

The simple answer is to have the ability to reach millions of new customers and offer a multitude of services from bank loans to account payments. Or, let’s not forget, to supply vital agricultural updates that could improve the quality of lives of millions of people and assist in the economic growth of many countries.

The rapid growth of the mobile market across Africa has had a positive impact on the continent’s economic growth. As the telecommunication sector grows, jobs are created not just within the MNOs, but also for their agents and supply chain partners.

Local businesses are benefiting from mobile banking as payments are easily made in the business to business and business to customer arena. Mobile application development has resulted in initiatives which have a massive effect on agriculture, medicine and the non-profit sector.

My worry is this: During the 6th Africa Agriculture Science Week (AASW6) conference held recently  in Accra, Ghana, over 90 booths were sponsored by exhibitors attempting to speak to the theme of the event, “Africa feeding Africa through agricultural science and innovation.” Fascinating technologies like the the all new ‘fufu’ making machine and fresh research findings like the “Push-Pull” strategy for pest management were exhibited by individuals, institutions and research organizations from Africa and the world over.

Among all these happenings, I failed to recognize any of the booths being occupied by an MNO. Maybe they don’t have anything to exhibit. But farmers use their services too — so why aren’t they here?

Full inclusion of the various mobile money services in the agricultural value chain could benefit both farmer livelihoods and the bottom line of mobile operators.  I am of the strong opinion that its about time that MNOs are tasked with factoring farmers in to their innovation strategies. Maybe in three years’ time, at the next AASW, we’ll see a couple of MNO booths in the lineup.

Blogpost by Nana Darko, Rite 90.1 FM and a social media reporter for AASW6.

Photo: W. Vota

7 thoughts on “Mobile network operators have much to gain from agriculture

    • Hello Armwell, good to connect to you again. Hope everything is fine out there? Wanted to thank you for reblogging my blog. Hope to hear from you again and soon. Greetings to all you connect to.

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