June 7, 2018

Digital Payment, Ethnocultural Food and Alternative Agriculture



Information technology has transformed the way we interact with ourselves and preferences. It’s so ubiquitous that stakeholders in the ethnocultural food markets are now catering to the needs of recent immigrants via online platforms such as My chopchop. Customers can order online and the product will be delivered at their doorsteps. Moreover, a few farmers and vendors at the Guelph’s Farmers market are also becoming digital. In the last few months, I have paid for my goat milk using square, a payment platform that is so easy that small businesses can accept payment via a magstripe reader inserted to the phone jack or a cordless peripheral for tapping.


Digital Alternative Agriculture

An environmental and health conscious individual can spend the weekend exploring his/her neighbourhood without compromising the sustainability of the landscape. The day can start with a coffee at Balzac's Coffee which promotes the production of organic, artisanal, and sustainable products. Then one can explore the farmers’ market, paying the local goat farmer using square which strengthens the local economy, reduces transaction costs and ecological footprint. But we still need to do more by learning from China and incorporating digital payments such as Alipay and WeChat pay to the alternative agriculture and ethnocultural food market. Chinese style digital payment requires the use of a smartphone, internet connectivity and a bank account – conditions that already exist in Canada. Even in countries where the internet is not perfect, mobile money is working well. Different variations of mobile payment, handled by telecommunication companies, have revolutionized African countries such as Kenya (Mpesa), Tanzania, Uganda, Zimbabwe, and Ghana.

Balzac'c Coffee Roasters, Guelph.


Digital ecosystem is so pronounce in China that nearly all transactions are done using digital payment in cities like Hangzhou and Shenzhen. Mobile payment does not require a smartphone (mobile phone can also be used). For example Mpesa is used for nearly all transactions in Kenya. It has also made the unbankable to be included in the financial landscape and economically active. Both digital and mobile payments will enhance the ethnocultural market and strengthen the viability of alternative agriculture. Stakeholders can easily transact businesses in rural Ontario with or without the involvement of a regular bank. A typical example of how small businesses are benefiting from digital payment, is the case of my friend in Shanghai who sells cooked African food and receives payment by his customers scanning his Quick Response Code (QR Code) and payment is instantaneous. Digital payment became popular in China in 2015 and he has been using it for business since then. The big players in this sector are Alipay and WeChat pay. He uses digital platforms for all aspects of his business including ordering, delivery and logistics. Logistics companies have their apps for easy transaction and fraud protection. The implementation of these ideas in the ethno cultural market in Canada will strengthen the economy and create job opportunities along the value chain that are consistent with the 21st century.

Digital payment and electronic agriculture will reduce the power of middlemen and encourage young people to consider agricultural production and marketing as viable entrepreneurial activities. Furthermore, digital payment will serve as an incentive for the development of community shared agriculture (CSA). A CSA is an arrangement that allows community members and farmers to share the risk of agricultural production.


CSA explained

CSA is an alternative agriculture that enhances the collaboration of farmers and consumers. Consumers buy shares from the farmer and the farmer supplies a pre-selected basket of goods based on what is available during the season and produced by the farmer or a group of farmers. To have a better understanding, let’s use the illustration below:

A farming couple in southwestern Ontario bought a 95 acres for vegetables and livestock production in 2009 and the financing of the farm is through CSA with 200 members. This farm has three full time staff and volunteers. The arrangement gives the farmers a reliable stream of income and ability to plan what to grow. The shareholders (subscribers) are updated about the activities on the farm and can contribute their time on the farm in-lieu of specified financial contribution. During the harvest period the shareholders can harvest the produce themselves, pick up their basket of goods at the farm gate or collect at delivery centers in selected towns or cities such as Guelph, London or Cambridge. The couple in this case study has an income of approximately 50,000CAD/annum. Labour is a huge part of the production, because it’s organic, so there is a need for ecological loving consumers to volunteer their time – gardening is therapeutic.

Shareholders of this CSA pay $575 CAD for a 20 week share in the summer. And the basket delivered to consumers is a function of what is available. This farm has successfully grown culturally appropriate vegetables such as Asian greens, spinach and tomatoes and they keep exploring new crops based on shareholders’ preferences. They produce 1200 to 1800 pounds of tomatoes from the greenhouse - no outdoor production of tomatoes. Although, there are capital expenses such as procurement of a tractor and coupled implements, the CSA is bio-dynamic – the farm is its own ecosystem. The planting calendar and land preparation is nature preserving. The sheep on the farm are grass-fed which translates to healthy livestock, no deworming and more omega-3 in the meat produced. Overall, the young owners of the CSA want to continue growing foods and their shareholders are happy with their customer relationship management.


Learning from China

Alternative agriculture, including CSA will benefit from digital wallet (and or mobile pay) by learning from platforms developed by Tencent (WeChat pay) and Alibaba (Alipay). Alibaba has gone a step further with it’s Hema Stores. Shopping behavior is changing as technology platforms suitable for online ordering continue to promote convenience in our global village. In China, the trend is instantaneous shopping based on a social media interaction linked to direct ordering from the producer. Canada has recently stepped up to this reality. For example, a collaboration between Metrolinx and Loblaws will allow commuters to order their groceries online and pick their bag on their way home in any of the few stations where the service is available this spring. I hope we will have a wallet less ethnocultural market in the near future.


The beginning of the future

The future of sustainable agriculture is guaranteed when information technology is blended with agriculture production, preferably organic. Crowdfunding is now used to link middle class people who are interested in farming but don’t have the time and access to farm land. With crowdfunding, ThriveAgric and FarmCrowdy,  co-farmers can buy a maize or any other produce farm in a remote village in Nigeria in a structure that is beneficial to the co-farmers, the tech startup and the local farmers. And very soon crypto-labelling will reduce the asymmetries and opacity in the halal, kosher, organic and alternative agriculture markets.

In a nutshell, digital payment, crowdfunding and other forms of e-agriculture will enhance production via market gardening (growing crops for the alternative market) and marketing through farmers’ markets, farm gate sales, self-harvests by consumers, buying groups, home delivery, and community shared agriculture.

Bamidele Adekunle, ECVOntario, SEDRD, University of Guelph

14 comments:

  1. With the increasing digitization of agribusiness landscape, CTA, Africa Rice and Syngenta foundation recently launched a project titled EMPRICE (Promoting youth entrepreneurship and job creation in the West African rice value chain). While the project targets young entrepreneurship in the face to teeming unemployed youth, it also provides ample opportunities for African youth to strengthen their ICTs capacities towards wealth creation and economic transformation. According to the AfDB, 'aside from basic infrastructure, lack of appropriate skills in robotics, artificial intelligence, and quantum computing, is one of the main constraints Africa faces in its quest to leapfrog'. Thus, Africa needs huge investments in STI, like in the case of the Kigali Institute of Science and Technology, which implements a curriculum that prepares Africa's growing youth population for the increasingly dynamic and competitive future. In view of this, the Rwanda Innovation Fund, with an approved AfDB loan of $30 million, aims to promote the innovation economy, and investing one-third of that loan in training for skills development, such as business plan writing.' The AfDB-UNIDO MoU will also facilitate cooperation in agro-industry development, eco-industrial parks, investment in innovation and technology, trade and capacity building, and access to finance, among other areas. More information is available at: https://www.devex.com/news/world-bank-s-jim-yong-kim-weighs-in-on-africa-s-industrialization-92820

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  2. Thank you Dr. Adekunle for this fascinating article. This article enlightens me on how farmers are adopting to the change and pacing forward with the evolving market. Ethnocultural agriculture has been taken at a higher level. It is not only a source of livelihood but a therapy for our lives, a uniting stand for different stakeholders shown in the idea of the CSA. Ethnocultural agriculture is also a podium of empowerment bringing people together to finance their cause expressed in crowdfunding agriculture. Ethnocultural agriculture is advancing, embracing the evolving digital world and exploiting the social platform. In accordance with Dr. Adekunle, for a sustainable agriculture, we need to blend agriculture with modern information technology. It goes without say we are living in a digital world. We need to integrate ethnocultural farming with the contemporary technology and utilize the available tech to our advantage. How exciting to know that one can sit home and wait for our basket of fresh ethnocultural foods to be delivered. I am intrigued by how the ethnocultural farmers are embracing the digital world. Thank you for this wonderful article.

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  3. I like the CSA initiative, how can I get involved both as a shareholder and volunteer

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  4. This is eye opening. Excellent piece. The CSA appeals to me. How does one key in to this?

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  5. One Acre Fund in partnership with Citi Bank in Kenya has a package of services offered to the farmers includes training and inputs like seed and fertilizer, the average farmer participating in the program earned nearly 50 percent more than peer farmers who do not participate. Payment is done via mobile money M-PESA. One Acre Fund has a loan product that fits the needs of the farmers. The loan product offers farmers flexible repayments with no repayment schedule on the M-Pesa platform

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  6. Wonderful write up sir! I particularly like the CSA and crowdfunding ideas. A lot of people interested in agriculture without knowing exactly how to go about it, or having the means to go into it independently would be willing to key into these ideas if they get a good understanding of how it works. It would be fantastic too if people learnt to appreciate organic produce here in my country,as they apparently do in the case of the case of the Southwestern Ontario farming couple.
    We will also do well to take a leaf out of China and Kenya's books in terms of digital and mobile payments.
    Although, businesses in Nigeria are already embracing mobile payment, the traditional methods of buying and selling is still prevalent in the agricultural sector. However, it would be a giant step,if we could agriculture to a digital level.

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  7. I like your blogs because they are very informative and eye opening. For sure, we are in a cashless economy and I am glad to hear about these developments. I recall in the past banks were centred in the city and major towns with rural people/farmers left out. I recall my primary teachers who had to mobilize someone at the end of the month to go to the capital city and pick their salary. But right now, with the advent of mobile money, financial services have been brought close to the common man in a rural area. No more need of traveling to city or major towns to do financial transactions.

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  8. This information is breathtaking, great knowledge passed across here sir ranging from the digital alternative agriculture, though businesses in Nigeria already allows mobile payment, in fact, the farm store I get foodstuffs owned by a young man though, allows my payment with POS but generally, there is still a lot of work to do considering that is just a tiny percent doing that. The conventional buying and selling with paper money is till very much predominant, but with Digital payment and electronic agriculture more young people will be emcouraged to consider agricultural production and marketing as viable entrepreneurial activities. CSA will also give opportunities to people who can't set it up on their own through the help of cooperative funding and risk sharing for agricultural production. Ethnocultural agriculture will therefore create empowerment, involve the youths more in agricultural practices, improve or help maintain a sustainable digital agriculture and the nation's eceonomy.

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    Replies
    1. Hello Funmibi, POS is not mobile payment. And digital payment is a step higher. Please watch this video - https://youtu.be/wI_BCisiFWg - for an example of mobile payment in a developing country.

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  9. Thanks for this post. i would like to contact you but can't find an emails. Please get in touch. africart

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    Replies
    1. Thanks for the interest. Please send your email to ecvontario2011@gmail.com. Regards

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  10. The time of spraying for rice helps to limit the development of pests and diseases and be more proactive in preventing pests and diseases on rice plants effectively by drones

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  11. The creation of Janadhanya, an association of members of the agricultural community who are empowered to act cooperatively to maintain agrobiodiversity, establish market links for farmer produce, and promote organic farming, among many other goals, was spearheaded by the GREEN Foundation. On a local level, they advance the sustainable agriculture movement.

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