The Chithumba Model: Combining Pre-Harvest Financing, GAP Training, and Access to Markets for Smallholder Farmers in Malawi
- Partner: Mennonite Economic Development Associates (MEDA), International Development Research Centre (IDRC)
- Publication Type: Brief
- Date: December 2019
- Team: MarketShare Associates
- Recommended Citation:
MarketShare Associates (MSA) was engaged as MEDA’s learning partner on INNOVATE and produced a series of briefs highlighting key results and insights from the research portfolio assessing the potential of non-traditional finance to stimulate agricultural innovation adoption among smallholder farmers in South Asia, South America and East Africa. MSA produced this brief summarizing findings from the case study conducted by Agronomy Technology Limited (ATL) titled: “A Case Study of the Chithumba Model: a non-traditional finance mechanism to improve access to farm inputs in Malawi”. The brief outlines the Chithumba bundled services model that includes loans, inputs, Good Agricultural Practices (GAP) training, and marketing services. The brief also highlights recommendations for agri-inputs credit issuers, implementing organizations, and agribusinesses.
From 2015-18, ATL, in partnership with the Agricultural Commodity Exchange for Africa (ACE), implemented a non-traditional finance mechanism called the Chithumba model in five districts across Malawi. The model offered a bundle of products and services that included loans, inputs, GAP training, and marketing services and served a total of 7,400 smallholder soya farmers over three seasons.
Key findings from the case study surveys and focus group discussions include:
- Input credit repayment rates were over 90% across all farmer groups for 2015-2018.
- Although 99% of clients claimed that the GAP information was useful, only 21% adopted the full set of recommendations presented during trainings.
- Among all respondents, 21% used ACE marketing services in the previous season to sell their yields, while 71% utilized local vendors to market their soybeans.
