School fees without debt

Kofí Touré is a poor, illiterate farmer from Ivory Coast. While he is an expert when it comes to the cocoa beans he grows on his smallholding, he finds it challenging to grasp the business end of running his farm. A cooperative of peer farmers has come to the rescue, helping him to overcome these barriers.

He had previously borrowed money from a cocoa trader so he could purchase fertiliser. In exchange for the loan, Touré had to commit to selling his cocoa harvest to the same trader below the market price. Although this put him in something of a squeeze, he was afraid to speak up since he was dependent on the trader to sell his next harvest.

Touré has since wised up, having joined a cooperative supported by Rabobank, along with several other farmers. The cooperative members now have a platform to share their concerns with each other, discuss cocoa prices and hone their business skills. In joining forces, they have also managed to strengthen their bargaining position.

Rabo International Advisory Services (RIAS) supports farmers in developing countries. Rather than supplying them with cash, this Rabobank division does so by establishing cooperatives or ensuring that existing cooperatives become more effective and professional in their operations. Behind the scenes this turns out to be a complex, political and systematic process, but once the foundation has been laid, this creates a powerful momentum: a solid cooperative gives farmers a voice, helps fight corruption and creates new opportunities. Touré developed a better understanding of his own situation and ways of improving it. The resources that have helped him along the way include cooperation with other farmers, cooperative unions and Rabobank’s support.

The bank has since introduced a number of innovations for the cooperative farmers. ‘There’s a huge risk involved in sending people with large amounts of cash into remote rural areas,’ Corné de Louw of RIAS explains. ‘Chairmen of cooperatives who travel out to cocoa farmers with a bag of cash are robbed on a regular basis. That’s why we decided to introduce bank accounts and mobile banking.’

Along with the benefit of improving safety, this also turned out to help the farmers to better manage their banking needs. De Louw: ‘Since they were no longer tempted by cash burning the proverbial hole in their pocket, they ended up spending a lot less money and were able to pay off their debt sooner. For example, Touré was excited to tell us that he was able to pay his daughter’s school fees for the first time without needing to borrow money. It’s at those times that you really see what a difference our work makes.’