Farmers in developing countries often find themselves in a poverty trap . As they have limited or no financial reserves, they cannot afford risky investments, which means that a given region tends to have many farmers that are active in the same form of mixed agriculture. This system is low risk, but the yields are also low. What’s more, no financial reserves are built up and when unforeseen expenditure occurs (e.g. medical costs or failed harvests), the farmers fall even further into the poverty trap.
A social crop insurance system can introduce change by removing (part of) the financial risk. This opens up the way to specialisation and market access for small farmers. However, crop insurance on its own is not sufficient; the premiums are often too high and it does not encourage development into a profitable company. By including crop insurances in an integrated monitoring and advice approach, (agricultural) development is stimulated in a (financial) low-risk environment.
This project may be regarded as the innovative and scientific foundation of the project ‘Fanning the Spark’. ‘Fanning the Spark’ aims to improve the economic and physical resilience of people through interventions that improve their living conditions. These interventions are based on three basic components:
- Improvement of quality of food production.
- Protection of food production by infrastructural and financial measures, for example savings, loans and insurances.
- An integrated and cooperative approach to productivity and health.
This project is based on methodological knowledge and innovation to give farmers customised advice. The products that are realised can be used in ‘Fanning the Spark’, but are also available for other projects.
Within the framework of ‘Secured Growth’ a monitoring and advice system is being developed for crop insurances in Burundi and Kenya. Currently there are separate monitoring systems and advice systems for small-scale agriculture and these can be used alongside one another. By linking the advice system to the monitoring system, a self-learning system is developed where users (farmers) can obtain advice on the most efficient use of water and food (nutrients), as well as information on their financial and agro‐ecological performance. To achieve this a preparatory phase is required during which knowledge is obtained on realistic harvest predictions in combination with production factors.
- Development of self-learning advice system, where the (agricultural) results achieved are fed back into the advice system.
- Linking of advice system to monitoring system so that advice is company-specific and takes account of local possibilities, including the use of own production assets (e.g. compost) and measures to reduce (company-specific) losses.
- Validation of the system in line with varying conditions as a result of weather and financial capabilities. The end product of this project – a validated self‐learning advice system for improved efficiency, reduced losses and higher production – is part of a crop insurance product that guarantees continuity in the long term.