Africa's digital agriculture sector faces funding crunch

Africa’s digital farming sector struggles as donor funding declines. [iStockphoto]

Africa’s digital agriculture sector is under pressure to attract private investment and develop sustainable business models as tightening donor funding threatens the continuity of technology-driven services targeting smallholder farmers.

Industry leaders say the sector must move beyond donor-dependent projects and build commercially viable solutions that can continue delivering agricultural information, financial services and market access after programme funding ends.

Speaking at the 10th AgriFin Learning Event in Nairobi, Prosper Global AgriFin Vice President for Africa Melaku Yirga challenged stakeholders to turn years of innovation into sustainable systems.

“We’ve spent years testing ideas, building partnerships and learning what works. So the real question now is: how do we turn all of that into systems that can actually last and scale?” he said.

The funding challenge comes as development finance faces mounting pressure, forcing organisations to reconsider how they finance and expand digital agricultural services while keeping them affordable for farmers.

Prosper Global AgriFin, formerly Mercy Corps AgriFin, said its programmes have reached more than 8.5 million smallholder farmers through digital information services, surpassing an initial target of five million. Women account for 41 per cent of those reached.

The organisation has supported digital agriculture initiatives in Kenya, Ethiopia, Nigeria, Tanzania and Uganda, working with financial institutions, agribusinesses and technology companies.

However, sustaining these gains will require investment models that connect technology to viable markets and demonstrate measurable benefits for farmers.

Africa’s digital farming sector struggles as donor funding declines. [iStockphoto]

Prosper Global AgriFin Programme Director Sieka Gatabaki said mobile technology could improve farmers’ access to information and financial services, but adoption remains critical.

“We must incentivise farmers to adopt these digital tools like mobile money that holds the key to broadening their revenue streams,” Gatabaki said.

He cited unpredictable weather, inadequate infrastructure, digital exclusion and the high cost of reaching individual farmers as persistent barriers to agricultural investment.

Digital platforms can help address some of these challenges through weather forecasts, agricultural advice and financial information, enabling farmers to make better decisions while helping lenders assess risks.

However, technology alone cannot guarantee sustainable growth without reliable infrastructure, trusted partnerships and financing models that make commercial sense.

Jasmina Lipovic, Global Finance Operations and Compliance Director at Prosper Global AgriFin, said the completion of funded programmes should not end the services and partnerships they establish.

“This is a transition, not an endpoint,” she said.

She said the organisation was strengthening partnerships and diversifying funding sources to sustain service delivery in a more constrained financing environment.

The push for sustainable investment also places greater emphasis on evidence to determine which solutions deserve further funding.

Stefan Wilhelm, Director of Social Innovation and Head of Latin America and Africa at the Bayer Foundation, challenged stakeholders to use evidence to guide investment decisions.

“So, what does the evidence tell us about where we should go next?” he asked.

Stakeholders said future investments should focus on solutions that deliver lasting benefits, attract commercial interest and remain accessible after external funding ends.

With climate shocks, rising input costs and volatile markets threatening agricultural productivity, sustainable financing will be critical to maintaining farmers’ access to digital services.

The sector’s next phase will depend on its ability to turn donor-supported innovations into viable businesses backed by private capital, public partnerships and services that meet farmers’ needs.