Innovations to empower rural communities and smallholder farmers

Lilongwe, March 11, Mana: The National Programme Coordinator at Farming Access for Rural Markets Smallholders and Enterprises (FARMSE), Dixon Ngwende, stated that through collaborative efforts, FARMSE and its partners have delivered impactful services, empowering individuals, strengthening livelihoods, and fostering sustainable economic growth.

Speaking at a FARMSE Innovation Symposium on Tuesday at Bingu International Convention Centre (BICC) Ngwende said the innovations have facilitated an increase in access points for financial services, including mobile banking services that enable users to receive and send money, make payments and register with financial service providers.

He added that the symposium highlighted success stories, lessons learned, and the tangible benefits communities have experienced through FARMSE-supported innovations, stating that these initiatives have introduced digital financial products, bridged gaps in financial services, and created inclusive economic opportunities.

“Inclusive financial systems are not just about transactions; they are about transforming lives, promoting resilience, and fostering economic empowerment. Sustainable financial inclusion requires continuous innovation, strategic partnerships, and a shared commitment to reaching the most underserved,” he said.

The Secretary to the Treasury at the Ministry of Finance, Economic Planning and Development, Dr. Betchani Tchereni said a flagship initiative of the government aims to reduce poverty, enhance livelihoods and improve the resilience of rural households by increasing access to sustainable financial services.

"The program targets 1.5 million households nationwide, with a special emphasis on women and youth.

“Malawi has made notable progress in financial inclusion, with the percentage of adults accessing financial services rising from 54% in 2014 to 88% in 2023. Digital financial services, particularly mobile money and agent banking, have played a crucial role in this growth," he said.

He, therefore pointed out that there is still a need to deepen access beyond basic services. The government and stakeholders must work together to expand access to credit, insurance and investment products, ensuring that rural communities can fully participate in the economy.

The IFAD Country Director, Bernadette Mukonyora, stated that rural financial inclusion remains a fundamental pillar of sustainable development in Malawi, where most of the population relies on agriculture and informal enterprises. She emphasized that access to appropriate financial services can significantly enhance productivity, resilience, and livelihoods.

However, rural communities have historically faced systemic barriers, including geographical constraints, limited financial literacy, and stringent banking requirements, which have hindered their participation in the formal financial sector.

"While progress has been made, with Malawi’s financial inclusion standing at 88% of the adult population, according to the 2023 FinScope Demand Survey, gaps in the range and depth of available financial services remain a challenge. The responsibility of addressing these gaps does not rest on any single entity, it requires concerted efforts from government, financial institutions, regulators, and development partners," she said.

She added that development partners play a catalytic role in fostering financial inclusion through innovation. At IFAD, they recognize that sustainable rural finance solutions must be inclusive, accessible, and scalable.

"By Providing strategic funding and technical assistance: development partners such as IFAD invest in pilot initiatives that financial institutions may consider too risky in their initial stages. Through the FARMSE Programme, IFAD has facilitated the development and scaling of digital financial services, micro-insurance products, agent banking, and community-based financial organizations (CBFOs). By de-risking investments in these innovations, IFAD through the FARMSE Programme has enabled the private sector to adopt and expand successful rural finance models,” said Mukonyora.

The event encouraged stakeholders to engage actively, share insights and explore new opportunities that will shape the future of financial inclusion, as the financial landscape continues to evolve, the collective goal remains to build a system where no one is left behind.