Authors: Albert Dah & Armel Katinan Ouattara
Within the second in a brand new weblog collection to rejoice the Worldwide 12 months of Cooperatives, Armel Ouattara and Albert Dah from Advans Côte d’Ivoire clarify the roots of Advans CI’s work with cooperatives, the rationale and penalties of successful the European Microfinance Award 2018, and the way Advans CI has diversified its work with cooperatives through many new merchandise and initiatives which were launched within the seven years since.
In 2018, Advans Côte d’Ivoire received the European Microfinance Award (EMA2018) on “Monetary Inclusion by Know-how” for its cell cash options to serve cocoa farmers and promote their kids’s faculty enrolment. Seven years later, new challenges have arisen, however Advans has additionally innovated and expanded its scope of motion to fulfill the wants of all people throughout the cooperative ecosystem.
Addressing Cooperatives’ Wants From The Begin
Advans Côte d’Ivoire is an Ivorian MFI providing loans, financial savings, and fee providers. Since our beginnings in 2012, we have now labored with cocoa cooperatives, which play a key position in rural Côte d’Ivoire.
An agricultural cooperative allows producers to pool assets, entry markets, and handle value dangers. In areas with restricted entry to capital and robust social ties, cooperatives are important gamers within the monetary inclusion sector. For years, within the absence of dedicated monetary establishments, cooperatives have labored to make sure the resilience of their producers by granting social credit, safeguarding producers’ money of their vaults, and distributing inputs and bikes. Early on, Advans recognised cooperatives because the entry level for producers’ monetary providers, changing into the primary Ivorian MFI to belief cooperatives and design merchandise particularly for them.
Advans Côte d’Ivoire started by providing in-kind loans to cocoa farmers working in cooperatives underneath a solidarity-based mannequin. We offer funding for buying fungicides, pesticides, fertilizers, remedy gear (equivalent to atomizers and sprayers), and protecting gear. We pay the enter suppliers straight on behalf of the farmers, and thru these grouped orders, the farmers profit from lowered costs. The farmers are then required to repay the mortgage to Advans by their cooperative. In 2024, practically 50,000 cocoa producers took out this mortgage.
The European Microfinance Award 2018
Following its technique to boost the monetary inclusion of cooperative staff, Advans continued to develop new merchandise. In 2018, it received the European Microfinance Award for its understanding of the wants of Ivorian cocoa farmers and its tailor-made technological options addressing the challenges of traceability and safety when cooperatives make funds to cocoa farmers.
The digital pockets service developed by Advans is especially well-suited for cooperative staff residing removed from banks and going through difficulties accessing formal monetary providers. This digital financial savings and fee resolution connects every producer’s Advans account to a Cell Cash account and facilitates wallet-to-bank and bank-to-wallet switch providers. Due to this fact, it has allowed cooperatives to make digital funds to farmers for his or her harvests and enabled producers to simply save and withdraw cash from their accounts, lowering the dangers related to dealing with money. Presently, over 130,000 producers have entry to those digital transaction providers by their financial savings accounts.
Because the irregular money circulation of farmers led to low faculty enrolment charges, we had been additionally recognised for providing small digital faculty loans based mostly on an algorithm reflecting the farmers’ money circulation, enabling them to finance their kids’s faculty charges on time. Certainly, the back-to-school season coincides with the lean season for cocoa farmers. As they typically have restricted funds throughout this era, many producers look ahead to the primary cocoa deliveries in October or November to enrol their kids in class. Since 2018, the variety of cooperatives taking digital faculty loans has doubled: practically 20,000 loans had been granted to cocoa producers, totalling 2.7 billion FCFA (4.71 million USD), facilitating an uninterrupted schooling for much more kids.
We additionally present life insurance coverage for cooperative staff and their households. In partnership with an insurance coverage firm, the premium is straight debited from the producer’s Advans account, and the reimbursement course of is tailored to the challenges of formally reporting claims and deaths in distant rural areas. Advans additionally affords an schooling insurance coverage coverage that covers their kids’s faculty charges within the occasion of the producer’s demise to make sure the continuity of their schooling.
By way of these initiatives, Advans CI has considerably contributed to the monetary resilience of farmers by transitioning from casual cooperative practices to formal digital monetary providers.
New Initiatives for Cooperatives
Following the EMA2018 success, Advans CI continues to co-design, with over 500 associate cooperatives, a tailor-made supply that meets the wants of cocoa farmers.
Advans offers coaching and schooling to cocoa farmers to empower them in family price range administration, financial savings, loans, danger administration, insurance coverage, funding, monetary establishments, and digital monetary providers for each private and agricultural improvement. For instance, in 2024, greater than 10,000 producers had been educated on the functioning, administration, and compensation of enter credit score. A sensitisation program on local weather change and its agricultural penalties has additionally been carried out for producers.
To extend the traceability, safety, and effectivity of funds between the cooperative and the cocoa farmers, Advans has developed a digital fee system for certification premiums. The cooperative sends Advans the bonus quantity to be paid for every producer, and Advans is chargeable for transferring the cash from the cooperative’s account to every producer’s account. This boosts producers’ financial savings and assists them in spreading their earnings all year long.
In 2024, to additional handle the wants of stakeholders within the cocoa sector, Advans launched a mortgage to assist farmers buy a bike or tricycle for transporting cocoa pods. This product goals to strengthen smallholder farmers’ capability for harvest and supply, enabling them to develop a transport exercise that generates further earnings whereas lowering prices paid by the cooperatives, which frequently cowl bills for bikes and tricycles. The compensation schedule is tailor-made to the specifics of the cocoa manufacturing season, as farmers have much less money to repay throughout the two lean intervals when their earnings diminishes. On the cooperative stage, a truck mortgage has additionally been established to make sure the transport and supply of cocoa by cooperatives.
Along with these providers, Advans has established a community of third-party brokers often known as “Advans Factors” to enhance the accessibility of economic providers in distant communities. Advans Factors are operated by companions positioned in cooperatives or small companies, facilitating entry to Advans providers for purchasers removed from branches. At an Advans Level, clients could make deposits and withdrawals straight from an Advans account and carry out easy transactions (equivalent to opening or reactivating an account, altering a phone quantity, and so forth.). Among the many 60 factors opened within the nation, one-third are at present positioned in cooperatives.
By understanding the challenges confronted by cocoa cooperatives, Advans designs extra tailor-made and appropriate credit score options to deal with the producers’ wants whereas contemplating the broader cooperative neighborhood.
How Advans’ Merchandise Have Diversified to Goal the Total Neighborhood
Enhancing the residing requirements of cocoa-producing households additionally requires supporting crop diversification and growing girls’s incomes. To realize this aim, Advans works with Village Financial savings and Mortgage Associations (VSLAs), which share many structural similarities with cooperatives and function a strategic mechanism for financial empowerment. The VSLA mannequin establishes self-managed and self-capitalised financial savings teams that use members’ financial savings to lend to one another. VSLAs usually encompass 15 to 30 members, with a mean of 78% being girls, residing in city or rural areas, together with very distant areas. This mannequin has expanded to 77 nations, involving over 20 million lively contributors worldwide.
To safe their financial savings and allow bigger loans, Advans CI has developed services devoted to VSLA members, significantly girls in cocoa-growing communities. VSLAs can open financial savings accounts to guard members’ financial savings. Moreover, VLSA members can open private accounts and make the most of Cell Cash options to deposit and withdraw funds, serving to to bridge the gender hole in entry to monetary providers.
Advans additionally offers life insurance coverage and loans to VLSAs. The members contribute to the insurance coverage by the VLSA’s Advans account, and fee is acquired in circumstances of hospitalisation or demise. As for the mortgage, it’s granted to the village affiliation as a authorized entity, which then makes use of the funds to finance particular person members’ income-generating actions or help a collective exercise, equivalent to farming or retail. Over the previous three years, the variety of VLSAs banked by Advans has doubled, and in 2024, greater than 200 loans had been issued to VLSAs.
In 2024, a brand new monetary product was developed to provide electrical gadgets to VLSA girls to boost their income-generating actions, together with fridges, followers, and blenders. Advans pays suppliers straight on behalf of those girls, who’re then required to repay the mortgage to Advans by their VLSA.
Advans continues to innovate and develop merchandise geared toward supporting the complete ecosystem surrounding cooperatives: cocoa producers by cell cash providers, bike and enter credit score; their wives by credit score to VSLAs; and their kids by schooling credit score. As new challenges come up attributable to local weather change, Advans CI can also be growing new merchandise to help cooperatives in tackling these points. We stay up for sharing extra on this sooner or later, and we’re happy to participate in e-MFP’s programme supporting the UN 12 months of Cooperatives.
Pictures: Advans Côte d’Ivoire.
Albert Dah is an agricultural finance professional with over 10 years of expertise in growing modern monetary options for the agricultural sector at Advans Côte d’Ivoire. After a Grasp’s diploma and a Certificates of Experience in Agricultural Finance, he has devoted his profession to supporting farmers, cooperatives, and rural organizations by facilitating small producers’ entry to monetary providers tailor-made to their wants. As Director of Agricultural Finance at ADVANS Côte d’Ivoire, Albert Dah leads the establishment’s agricultural finance technique, aiming to advertise monetary inclusion for small-scale producers, cooperatives, and stakeholders in agricultural worth chains.
Armel Katinan Ouattara is the Enterprise Growth Supervisor at Advans Côte d’Ivoire. He has over 13 years of expertise in microfinance, monetary inclusion, and agricultural finance. His experience consists of mission administration, strategic planning, monetary product design, and innovation in distribution channel improvement, significantly for digital and agricultural monetary inclusion. Armel holds a Grasp of Science in Company Finance from the Lyon Faculty of Administration and a Certificates of Experience in Agricultural Finance from the Frankfurt Faculty of Finance & Administration.