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Built for All: Digital Payments for Farmers in Mexico

SDGs Impacted

Chiapas, Mexico, is known for delicious specialty coffee and is responsible for 30-40 percent of Mexico’s coffee production. In Chiapas, nearly a quarter of the workforce earns their livelihood from the coffee industry, and many of those people are smallholder farmers. Compared with business owners in more urban areas of Mexico, these farmers have few options to securely store and manage their money. As a result, farmers often rely on cash-only middlemen that siphon a significant percentage of farmers’ earnings to bring their products to market. Relying on cash-only systems also exposes farmers to greater risk of theft, reduces farmer access to better pricing for their products as well as to financial products and services that can make their businesses more stable and resilient. In December 2018, Mastercard partnered with Fundación Capital and the Neumann Kaffee Gruppe, the world’s largest coffee trading house, to digitize payments and increase financial inclusion and transparency in the Neumann Kaffee Gruppe’s supply chain through a pilot program called Cafe Paga.

Impact / Outcome
So far, the program has enrolled 1,231 farmers in 22 localities through NKG´s local subsidiary in Mexico: Exportadora de Café California. Rather than lose crop value through a cash-dependent system, participating farmers can expect to preserve about 15 percent of their crop’s value through electronic payments.
Funding sources
Private
Key Metrics
Leverage financial inclusion as a way to build resiliency by creating access to credit and other financial services for small farmers
Locations
Latin America, Mexico
Sector
Financial services
Intervention lever
Policy
Operating model
Fully private
Target population
Rural
Year published
01 January 2021
Organization involved
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Mastercard

The EDISON Alliance

A World Economic Forum Initiative