Supporting VFI to Improve Agro-Finance Services Provided to Small-holder Farmers of Tanzania

About the Project 

With an estimated population of 45 million, Tanzania is one of the most-populated countries in Africa. However, it also one of the poorest with around 33% of its population living below the poverty line. The Tanzanian economy depends heavily on agriculture, which accounts for almost half of its GDP and provides 65% of its exports.

In 2015, Vision Fund Tanzania, the fourth-largest growing microfinance institution in Tanzania, which supports low-income families and communities by providing agro loans and other financial services, introduced a mobile IT platform to make the internal processes of agro loans and savings account applications paperless. The system biometrically tagged and GPS-marked all clients and internal transactions to reduce opportunities for fraud. In 2017, this app was amended to include an MLC Agro Lending Application, aimed at increasing the efficiency of information collection and processing.

To assess the efficiency of the app and to measure its impact on targeted communities, as well as to identify gaps for improvement, the VFT commissioned a study in 2018, which was carried out by ACT.

Our Role 

The goal of this project was to evaluate the effect of the agro loan app on the performance of the organization and to provide recommendations for improvement.

The research covered two main target groups: the staff of the Vision Fund Tanzania (business center/branch managers, credit officers, IT department staff, and change managers) and farmers who had used the VFT’s agricultural loans. This was a qualitative research, entailing in-depth interviews and group interviews.

The study identified:

• The general context and pattern of the agro loan mobile app’s usage (including usage of the VFT’s tablet app);
• Positive and negatives aspects of the agro loan app;
• All changes and improvements attributable to the introduction of the agro loan app;
• Good/bad preconditions affecting the VFT’s tablet app usage;
• Desirable changes and recommendations regarding the agro loan mobile app and suggested updates/improvements to the VFT’s tablet app;
• Local attitudes towards the practice of using mobile money;
• Attitudes of local farmers towards the agro loan app and its impact on their lives; and
• Farmers’ wishes and recommendations regarding agro loans and their conditions.

Project Outcome(s) 

Based on our recommendations, VFI improved the management of the agro loan disbursement process and provided local farmers with a more user-friendly app. The recommendations covered four different areas of improvement: development, functionality, process, and support.