Around the world, an estimated 2.5 billion people live in households relying on agricultural production for their livelihoods. Many of them are small-scale farmers, the people who already produce the majority of the world’s food. As the global population continues to rise, demand for the goods they produce will only increase.
At Heifer International, we work with some of the world’s poorest farmers, helping them to sustainably increase production and access new markets — increasing their sales and incomes. As farmers grow their businesses, one of the major challenges they face is access to credit.
The UN Food and Agriculture Organization estimates less than 10 percent of small-scale farmers can access credit. Without it, they cannot cover day-to-day expenses, buy improved farming inputs like fertilizers and certified seeds, or invest in livestock and irrigation systems to increase crop production.
In fact, globally, about 1.7 billion adults remain unbanked — without an account at a financial institution or with a mobile money provider. One of the biggest barriers they face is the cost of the account itself and the transaction charges that come with it.
As a result, many people are reliant on local money lenders. Facing high interest rates and loans that can be impossible to pay off, many are forced to move to find work, often far from their families. Most send money home in the form of remittances, putting food on their tables and a roof over their family’s head. But sending money home incurs costs for both senders and recipients, meaning the people that earn the least often end up paying far more for financial transactions.
Today, more and more people around the world have access to mobile phones and the internet. We believe this creates an opportunity for a financial system that better serves the needs of the farmers we work with.
We are always looking for opportunities to increase access to finance for farmers, and I’m excited to announce that today, Heifer International is joining the Libra Association. The Libra Association is an independent member organization developing a blockchain-based payment system that will support financial inclusion, competition, and responsible financial services innovation. The Libra Association’s mission is to enable a simple global payment system and financial infrastructure that empowers billions of people around the globe.
We believe the Libra project has the potential to deliver a lower-cost, more accessible and more connected global financial system. One that will enable people that currently do not have access to the financial system to be connected to a more reliable and cost-effective platform.