Sometime in 2016, Jean Anthony Onyait was on a study trip to Tirinyi where he met a special woman that would change the story of his life.
This woman was called Akello. She was a village hero! A hero because she was in police custody for failure to pay a loan received from a microfinance institution on behalf of members of her village farmers’ group.
She was the leader of a group of smallholder farmers. They needed money to buy farm inputs but all had no collateral. Akello had inherited some property from her late husband and she decided to use it as collateral to borrow money and give it to group members with the hope that they would use the money responsibly and manage to repay the loan.
“Her group members failed to pay and she was arrested and the property was going to be taken. Just imagine what would happen to her children,” echoes Onyait.
On hearing this sad story, Onyait intervened. Together with the team he was with, they decided to travel back to Kampala, raise as much money as possible, and return to Tirinyi to settle Akello’s debt.
And he did not stop there. He was inspired to start Akellobanker, a digital infrastructure that can be used to enable millions of smallholders and SMEs to access important and life-saving collateral-free services such as access to farm inputs and extension services on credit.
“We gave our company that name in respect of Akello. AkelloBanker means a bank for people like Akello who want to see their production and productivity increase but they do not have the resources and information that can help them,” Onyait, the AkelloBanker Chief Executive Officer, says.
Born in Tirinyi, AkelloBanker has spread wings across Uganda, impacting more than 180,000 smallholders as well as Small and Mid-size Enterprises.
“These smallholders are farmers who are toiling every day to produce what we eat while the SMEs comprise input dealers who are in the local communities with small stalls where farmers go and access inputs,” he explains.
According to Onyait, more than 700 SMEs have been empowered and they have been able to digitize their agricultural supplies to the farmers. They are also able to access credit which they are able to use for restocking their inputs.
“Every year, we have at least five transactions done by each farmer. These are about 900,000 transactions within a given period of time. We have been able to power over 20 million dollars worth of credit which has passed through the system to facilitate the farmers,” he explains.
With this digital platform, a farmer using data-driven approaches can access a loan instantly using their mobile phones. It can be via a smartphone or any basic mobile phone.
“If they cannot access cash…they should be able to access inputs on credit…,” he says.
One of the SACCOs using AkelloBanker services is LWEDE [Lwengo Development Cooperative Society] in Lwengo district.
These are mostly involved in providing financial services to coffee and poultry farmers.
“They are powering our operations through a system called Quest and it has been very effective in financial management. Even when we get technical challenges, we reach out to them and they sort it immediately,” said Charles Asiimwe, the Lwede Sacco Manager.
Farmers are happy too.
According to Elizabeth Atugonza, she has borrowed from Lwede Sacco over 10 times using her phone and the system is very user-friendly.
Further, John Matovu Ssagala, a Lwengo-based farmer and member of LWEDE noted that the platform has offered him multiple loans that have helped him remain in business.
Onyait says they are powering Saccos in every part of the country such as Hakashinyi Sacco in Mitooma-Inshaka, Bunyaruguru Development Sacco, Achila Enterprises in Eastern Uganda, Oyam DFA in Northern Uganda, among others.
“Oyam DFA is one of the biggest farmers’ organizations which not only produces grain but we have been able to link them to Makerere University where they are able to get foundation seed on credit. We are able to facilitate all that,” he explains.
40 Days 40 FinTechs.
Onyait says that some of the challenges in driving financial inclusion in Uganda include limited infrastructure (internet and device access), illiteracy on how to use these digital services, and cyber security.
He is, however, happy that initiatives such as 40 Days 40 FinTechs are coming up to try and reduce the divide between the empowered community and the people at the bottom of the pyramid.
“The 40 Days 40 FinTechs initiative is a very strong platform to bring like-minded players into one place to share ideas and devise means on how we can deepen the financial sector. Since it comes from the issue of technology or financial technology providers, we are able to learn about the past challenges that commercial banks had to go through. We have been able to learn from the telecoms. So, the efforts by the different actors definitely give us a learning platform,” he says.
Now in its fourth season, HiPipo’s 40 Days 40 FinTechs initiative has become a household name in the financial technology space of the East African region. In the last three editions, more than 100 FinTechs have been showcased, highlighting stories changing people’s lives, especially in the under-served sectors. This initiative is run by HiPipo in partnership with the Level One Project, Mojaloop Foundation, INFITX, Cyberplc Academy, Ideation Corner, and Crosslake Technologies with support from the Bill and Melinda Gates Foundation.
AkelloBanker is participant number three of the fourth season of this initiative. Innocent Kawooya, the HiPipo CEO noted that AkelloBanker is a clear example of both the life and time-saving abilities of Financial Technology.