Input Credit Scheme Links Agro-Dealers to Farmers
Agricultural productivity depends on the affordability and accessibility of agriculture inputs including seeds, pesticides, and fertilizers that are essential for improving yield and raising incomes (AGRA, 2013). Unfortunately, farmers in Rwanda must incur significant up-front investment in agro-inputs before they can generate revenues to recoup these pre-seasonal expenses. Without access to finance, poor farmers are exposed to perpetual sub-optimal yield and low revenues due to their inability to invest in appropriate inputs. As a result, production levels of key crops in Rwanda including maize, potato, and vegetables, are relatively low.
Hinga Weze set up a pilot input-credit scheme in two districts to bridge the gaps in the financing of agro-input supplies for farmers and later scaled it up to link more agro-dealers to farmers to boost their production and incomes. This is in line with part of Hinga Weze’s goal to sustainably increase smallholder farmers’ income and increase the resilience of Rwanda’s agricultural and food systems.
Funded by USAID and Feed the Future, Hinga Weze has now enrolled 318 agro-dealers across its 10 targeted districts of Rwanda, into the scaled-up input-credit scheme to gain technical knowledge on agrochemical regulation, climate-smart agriculture, nutrition-sensitive agriculture, and product knowledge in pesticides, fertilizers, and lime. They were also provided with training and skills in business record-keeping, warehouse management, and marketing strategies to give good services and products to farmers who were able to double their harvest.
Through Hinga Weze’s model and support, the agro-dealers were also linked to financial institutions that to date have provided 79 agro-dealers with loans worth over $277,242. For example, 11 agro-dealers from Karongi were assisted to access loans from banks and Savings and Credit Cooperatives (SACCOs) worth $21,019 (19,800,000 RWF) and were, therefore, able to provide agro-inputs on credit directly to farmers, who, in turn, were able to repay the loan upon harvesting. In the last three months, the scheme has assisted 1,838 farmers to access inputs worth $38,419.